Am I Carnally Minded?

Oswald confuses me here. First, his points as I understand them:

• Only the regenerate soul is aware of its carnality (that which is related to the passions and appetites of the body) because it is the conflict between the Holy Spirit and the flesh which creates the awareness in the first place.
• Unregenerate man has no such conflict and, hence, no such awareness.
• Carnality disappears with sanctification.
• When biblical truth produces a rebellious spirit within me, that is proof of my carnality.

Here's the line that confuses me: "If sanctification is being worked out, there is no trace of that spirit left" -- and the last paragraph where Oswald suggests that I will marvel at God's work in my life. I will know without doubt that carnality has left. The evidence will be irrefutable.

My confusion: Who fits into that category? Aren't we all in process? Are we ever without a trace of rebellion? And doesn't that marveling at God's work in my own life come awfully close to a pharisaical obsession with my own whiteness?

Are there really levels of sanctification? If it is the regenerate soul who is aware of the struggle, then hasn't sanctification already begun in him? Isn't the awareness itself part of the sanctification? Working in a homeless shelter, I know Christians -- former addicts and felons -- whose lives have changed radically in ways very visible to the outside world. I am also good friends with people whose lives have undergone much more subtle, less visible changes. Is one more sanctified than the other? One certainly might have a harder time pointing out irrefutable evidence of transformation . . . But God looks at the heart. He knows the changes he has wrought.

I guess my question is this: Is the absence of carnality attainable in this life? Oswald seems to indicate that it is, but that has not been my experience.