Below is the NIV text of the relevant verses of Genesis 1:
6 And God said, “Let there be a vault between the waters to separate water from water.” 7 So God made the vault and separated the water under the vault from the water above it. And it was so. 8 God called the vault “sky.” And there was evening, and there was morning—the second day.
14 And God said, “Let there be lights in the vault of the sky to separate the day from the night, and let them serve as signs to mark sacred times, and days and years, 15 and let them be lights in the vault of the sky to give light on the earth.” And it was so. 16 God made two great lights—the greater light to govern the day and the lesser light to govern the night. He also made the stars. 17 God set them in the vault of the sky to give light on the earth, 18 to govern the day and the night, and to separate light from darkness. And God saw that it was good. 19 And there was evening, and there was morning—the fourth day.
20 And God said, “Let the water teem with living creatures, and let birds fly above the earth across the vault of the sky.”
So the text clearly says that the place where the birds are, and the place where the sun, moon, and stars are, is the vault of the sky, which is between the surface (land or water) and the "other" water above. As "sky" refers to both atmosphere and cosmos, I see no issue.