Is it permissible to supplicate with the following formula: "O Allah, bestow upon Muhammad a prayer as he would love it to be, and as You would love it to be, by which You admit me to the highest Paradise and by which You grant me and those I love what we desire," and is it permissible to dedicate the reward of praying upon the Prophet to others?

The formula that the Prophet, peace and blessings be upon him, taught his companions for praying upon him is the best.

A Muslim's supplication that Allah grant the reward of his prayer to him and to others is meaningless; it is idle talk, unless he intends to make tawassul (seek nearness to Allah) through Allah's own action, i.e., His granting you the reward.

It is more appropriate for a Muslim to make supplication through a righteous deed itself, because tawassul through righteous deeds is permissible. However, if the intention is to dedicate the reward to you and to others, then this has another detailed explanation.