With flags you also have the issue of how to represent politically disputed regions e.g. Taiwan even when the languages used locally are pretty clear-cut.

In the specific case of Taiwan, if you want to maintain good business relations with normal civilians on both sides of the straits you need to represent Taiwan as a state to Mainland China IPs and represent it as a country to Taiwanese IPs and most of the rest of the world.

I'm not advocating any particular political view, this is just the technological fuss you have to go through to maximize the number of happy customers. So sometimes it's much easier to just forget the flags, state the language and currency directly as text, and skirt around these issues.

As for language selection, I really don't think it's necessary to beautify it UI-wise. Pick based on the user's Accept-Language header and 99.99% of the time you'll present it exactly as the user wanted without them having to select anything. You can then implement a text-only language selector somewhere in a less conspicuous place, such as the footer, than polluting your navigation header.