Where I supposed that "observed as <distance>" just means how much red-shifted its light is- we don't really have any other way to measure such distances. This in turn only measures how much the space has expanded between us and the original starting point, much closer than 13 billion light years away. So we can say that we're seeing a star that is "now" 46 billion ly from us, but must have been only a few billion ly away when it emitted the light we're receiving. Correct?
You're right. The star could not have been more than a few billion light years away when it emitted the photons that we're seeing. Otherwise, not only would the photons have not reached us yet, they will probably never reach us because the universe is expanding faster than the speed of light.
