Not nepAli

Even Prasenajit says “bhagavā’pi kosalako aham’pi kosalako bhagavā’pi khattiyo ahampi khattiyo bhagavā’pi asītiko aham’pi asītiko” (Buddha is Kosalan & I too am Kosalan. Buddha is Kshatriya & I too am Kshatriya. Buddha is 80 years old & I too am 80 years old).

kosala

He identified as “Kosalaka” (a person from Kosala, as opposed to Videha or Magadha) and his Śākya clan traditionally traced its descent from the legendary king Ikṣvāku/Okkāka/Iṣmaho.

Kosala corresponds to Awadh in modern UP and Awadhi is the most commonly spoken language in Kapilavastu district of Nepal.

Not nepal

While referring to him as being from “UP” or “Bihar” would be anachronistic, referring to him as Nepali is also anachronistic. The term Nepal originally referred to the Kathmandu valley, not Tarai Madhesh region. The borders of modern Nepal are largely the result of the conquest by Malla Dynasty rulers and the 19th century unification campaigns by King Prithvi Narayan Shah. The Khaśa Malla kingdom was not located in Nepal but rather in the Karnali river basin (the area between Nanda Devi in Uttarakhand and Dhaulagiri in Nepal), which was located to the West of “Nepal” (i.e. Kathmandu Valley). Ḍoyas from Mithilā and Khaśas from Khaśa Malla kingdom would frequently launch raids into “Nepal” (i.e. Kathmandu Valley). While the Khaśas themselves were not from Nepal proper, they referred to their kingdom as Nepal after conquering Nepal and the Gorkha ruler PNS expanded the borders further.

This is a source of confusion as people assume that the ancient Nepāla (mentioned in Kūrmavibhāga of AV Pariśiṣṭa, Prayāgapraśasti, etc.) refers to modern Nepal from Mechi to Mahakali.

Language

Prior to Awadhi becoming prominent, the most common language would’ve been Tharu, but we know that Buddha did not speak Tharu. The inscription on the Piprahwa Vase is also in an Ardhamagadhi dialect which is a precursor of Awadhi.