Let $\kappa$ be a cardinal. I want to show that every ordinal $\alpha < \kappa^+$ can be embedded (as an order) in any interval of $\kappa^{<\omega}$, ordered lexicographically.
This is exactly how Jech states the result in his paper about trees (page 3). He doesn't define the order explicitly, but I think that he refers to this (so if $x \subseteq y$ then $x \leq y$).
I tried to adapt the steps for the similar statement about the rational numbers (Embedding ordinals in $\mathbb{Q}$), but I got nowhere.
Update: as pointed out in the comments, my guess about what the author means by "lexicographic order" is very unlikely to be correct, since then $\kappa^{<\omega}$ wouldn't be dense.
Your original understanding of the lexicographic order on $\kappa^{<\omega}$ is correct. The claim isn’t true as stated, but something that should be good enough for the intended purpose is true.
Now let $x,y\in\kappa^{<\omega}$ be such that $x\prec y$, where $\preceq$ is the lexicographic order on $\kappa^{<\omega}$. Assume further that if $y=x^\frown z$, at least one term of $z$ is not $0$. Then there is an $x'\succeq x$ such that $x'\prec y$ and $x'$ is not an initial segment of $y$. Let
$$I=\left\{z\in\kappa^{<\omega}:x'\subsetneqq z\right\}\;$$
then $I$ is order-isomorphic to $\kappa^{<\omega}$, and $I\subseteq(x',y)\subseteq(x,y)$. Thus, each ordinal less than $\kappa^+$ order-embeds into any interval $(x,y)$ of $\langle\kappa^{<\omega},\preceq\rangle$ such that $y$ is not an extension of $x$ by a string of zeroes.