How can we reconcile the description of a believer's grave being carpeted with Jannah and expanding as far as the eye can see, with the Hadith of the grave's embrace (dhammah) for Sa'd ibn Mu'adh despite his high status, and does the grave's embrace refer to an embrace of longing or is it something else?

There is no contradiction between the narrowing of the grave for the believer and its subsequent widening for him. The embrace of the grave occurs for the believer at the beginning of his descent into it, and then the grave expands for him, unlike the disbeliever for whom the embrace of the grave persists. The hadith (definition) about the trembling of the Throne of the Most Merciful at the death of Sa'd ibn Mu'adh is authentic and agreed upon, having reached the level of continuous transmission (tawatur), as it was narrated by ten or more Companions.