You seem to be missing my point.
I'm not saying anything about protecting the credentials from others. I'm saying something about preserving the knowledge, and assuming ordinary competence with computers.
You mention my birth certificate. I can get a copy of it, no problem, if I lose the copy I've got (and I don't know offhand where that went to). If it is destroyed, that's annoying, not serious.
Where do you put that CD-ROM? If you keep it at home, you can lose it in a house fire. If it's in a safe deposit box, it's safer, but not completely safe. It also will require periodic trips to verify that the disk is still readable. (Taking serious precautions to back something up is not characteristic of the average computer user.) Spread the CD-ROMs around, and you're increasing the chance that somebody will get hold of a copy. Keep them limited and you're increasing the chance that you'll lose your wallet.
For perhaps 95% of the people in the world, any password they put on it will be half-assed, and they can't even spell steganography, let alone know what it means. If the CD-ROM falls into the wrong hands, anybody competent with computers can probably break it,
You are considering certainly no more than 5% of the population when you suggest avoiding third parties.