Dear Girl in a Glen,
I am relating to your and Steve's story rather well. I have (very recently) been in your position, torn between an ex and a current relationship.
It's painful, confusing, and unenviable. But sometimes the clearest, shortest answers are best for complicated situations, and that rule applies here, I believe. There's also the matter of romantic destiny, which I'll address, since both you and Steve mention it.
You say yourself that Matt has been nothing but good to you, and you're enjoying the relationship. You are at the same time building castles in the air with Steve based on your history and continuing intermittent contact with him and some perceived changes in areas you found lacking before.
You Need a Break from Steve
This is very dangerous. In my opinion, you need a serious time out from Steve, time for you and him to settle down emotionally and become available for a relationship once again.
I'm hesitant to advise anything for you and Matt, even though I feel you two may not work out because of this uncertainty. It is possible for you to develop in the context of the relationship with him, and I hope whatever happens is not unnecessarily painful for either of you.
If You are Meant to be Together, You Will End Up Together... Eventually
All this relates to the feeling of belonging to one another, feeling right for each other, this hard-to-define fated-ness you and Steve both talk about. I believe (and I mean this sincerely - I feel this is true for me personally) that if two people are meant to be together, they will end up together when the time is right.
This does not mean they can just sit back and let things happen around them, but it may mean actively or consciously NOT being together when it's NOT right.
I think this is one of those times, and you should try to enjoy being with Matt and get over Steve. If you continue feeling torn and/or more attracted to Steve, you HAVE to break up with Matt and then give yourself more time AWAY from Steve to make sure your feelings (and his) are genuine. It may take a while, but you're young and you have some time. Don't rush into anything.
All this also has to do with your general position in life and your career goals and aspirations. You may or may not be sure right now what you want to do with your life and whether or not you want to have a career doing what you're doing right now. That's another thing you shouldn't rush into, and another area in which I speak from experience. You need time to figure that part of your life out as well, and it may be better to do that outside a relationship, certainly one with as much predetermined stress as the one with Steve.
Your life is truly just beginning, give yourself a chance to enjoy it and make the most of it! And remember that if you're meant to be with someone, you'll end up with him in due time.