I think I am a bit confused and likely just miss a key definition somewhere, so I'll just ask a naive question:
From N in V you have constructed 'N in *V. You argue that 'N contains N (in a specific sense) but also non-standard numbers (represented by non-constant sequences such as [(0,1,2,3,...)]). Then you observe that 'N is the initial model of PA in *V from which you conclude that ('N,*V) is not the example we want.
But as I understand it, you just showed that 'N is richer than N, in particular it contains non-standard elements. And to reduce to only elements of the type [(a,a,a,...)] which correspond to N wihtin 'N would correspond to a non-initial model, right?
So why isn't this the example you want?