Yes assuming that the voltage sags to that point, in reality you are right and it probably doesn't. I generally use 3.7 so as to account for pretty much all types of batteries, but again if you have a more exact number then use that. And yes, 3.4 was a off the top of my head guess without knowing the LED however after reviewing the data (here) it probably is closer to 4 volts. And yes, if you hook up your DMM to measure the current you will see the true current rather than the calculated current. And yes, the buck driver will most likely take the current down some, however it without data on that it is impossible to know the efficiency of said buck driver (in my experience they can range from 60% to 90% efficient).
I already did, and so far the 7 XM-L dropin and the switch seem to have held up fine. Currently I'm trying to figure out a automated way of pressing the switch thousands of times to test it.