1. The books say "no hot baths" because of a risk of birth defects from elevated body temp during the first trimester -- but it's a bit of an urban legend, really, because you have to elevate your core body temp and *keep it elevated* -- and nobody ever does that on purpose -- it can pretty much only happen when you have a fever (from illness) that you can't reduce. I think you have to have it for 24 hours+. Anyone with a choice will immediately and reflexively get out of the water when the core body temp starts going up -- it just feels yucky.
2. If I read it right, the OP's midwife suggested really warm baths specifically for *stopping preterm labor*. I don't think the OP was suggesting that every laboring mom would want to labor in water as hot as she can stand it.
3. ITA, the buoyancy is good, and I've read a lot of water birth stories where mom said "The water was lukewarm, but I didn't care, it felt so good." On the other hand, I personally like it warm when I birth. And I've also read and heard a lot of water birth stories where the midwife made the water much warmer than the mother wanted -- and then argued with the mom that that was what was good for the baby. Hmmmph. I don't think so. I think the MOTHER is the best judge of the right water temp. I think this is like a 100 other things in birth -- it varies from woman to woman , and even from one of her births to another of her births.
4. The idea that the water should be close to body temp water so it doesn't shock the baby...
Babies born into the air (probably most births in human history) are NOT born into body temperature air. I have read that it is (in part) the temperature DIFFERENCE between the womb and the world that stimulates the baby to breathe. This idea seems supported by a common thread I find in the waterbirth literature -- the idea that when a baby is born into body temp water, he will probably not breathe immediately. So, if you'd like body temp water, be prepared to NOT PANIC so long as the cord is still pulsing. It may take baby a few minutes to decide that breathing is a good idea. My 3rd did this (and I *DID* panic!!), and I've since then seen it on a bunch of water birth videos. This recent UC is a good example of what I am describing:http://www.youtube.com/watch?v=oPNKgBjqpts
For my upcoming birth, I'm torn as to the water temp at birth - -I was so startled by the relaxed floppy baby with birth #3, that for #4 I may have to make the water a little colder, or pull her completely out of the water into the air, so that I can get a good response from baby without panicking. Or, I may remain calm like the mom in the video above. I dunno.
5. All of the above is sounding kind of know-it-all ish, but can you just take it for my opinion, and love me anyway?