Micro-heterogeneity in aqueous solutions of 2-butoxyethanol (BE), a system with closed loop miscibility gap, has been explored via absorption and time-resolved fluorescence measurements of a dissolved dipolar solute, coumarin 153 (C153), in the water-rich region at various BE mole fractions (0 ≤ XBE ≤ 0.25) in the temperature range, 278 ≤ T/K ≤ 320. Evidences for both alcohol-induced H-bond strengthening and subsequent structural transition of H-bond network have been observed. Analyses of steady state and time-resolved spectroscopic data for these aqueous mixtures and comparisons with the results for aqueous solutions of ethanol and tertiary butanol indicate that alcohol aggregation in BE/water mixtures is driven by hydrophobic interaction with no or insignificant role for criticality-driven concentration fluctuations preceding phase separation. Excitation energy dependence of fluorescence emission of C153 confirms formation of aggregated structures at very low BE mole fractions. No asymptotic critical power law dependence for relaxation rates of the type, k ∝ (|T - Tc|/Tc)(γ), with γ denoting universal critical constant, has been observed for both solute's rotational relaxation and population relaxation rates in these mixtures upon either approaching to critical concentration or critical temperature. Estimated activation energies for rotational relaxation rate of C153 and solution viscosity have been found to follow each other with no abrupt changes in either of them at any mixture composition. In addition, measured C153 rotation times at various compositions and temperatures reflect near-hydrodynamic viscosity coupling through the dependence,〈τr〉∝ (η/T)(p), with p = 0.8-1.0, suggesting solute's orientational relaxation dynamics being, on an average, temporally homogeneous.