Part of the space between the firmament and Earth is the area in contact with the Earth that we call the atmosphere, or sky. This is where the birds fly. It's referred to as the open firmament.
Billions of fish died during Noah's flood. Whole tribes were buried in sediment as it fell out of the sky. Wait, what? How does sediment fall out of the sky? Good question. We're going to have fun with that tomorrow.
According to the context of our verse the open firmament is where birds fly, so it's the atmosphere or sky. We can consider it to be the first of three heavens.
One of our favorite ways to study the Bible is to follow a doctrine through from the first time it's mentioned to the last. This is a great way to develop understanding of the doctrine in the broad narrative of scripture.
When the Bible refers to something that hath life, it is referring to an entity which has a spirit and a soul. It is not equivalent to the biological definition of life.
The biological definition of life and what the Bible describes as living aren't the same thing. This is important to know as we see how the process of creation unfolded. Biology is the foundation of secular humanism.