What Musk is doing us nothing new and is know to failure in the future like the space shuttle. Due to the extreme conditions and fatigue, there will be structural problems.
Indeed. Probably recovery of the first stage destroys value - have not seen one up close or seen drawings but I expect it is just a steel tube, maybe two additional steel tanks for oxidizer and fuel, fuel lines, control valves, combustion nozzle and perhaps signal and power lines from the capsule if that is where the controller is located. Also in addition to extreme conditions and fatigue that you noted, the cost to test and refurbish the recovered first stage will exceed the cost of just using a new one, especially since the design phase is over and it is just assembly from off the shelf components (what SpaceX uses). And according to Wikipedia SpaceX does charge More for the reusable Falcon 9.xxxx AND offers a lower payload for that privilege.
The total weight of steel in stage 1 - my guess 25-50 tonnes. The United States alone has permanently buried greater than 100 million tonnes of very high quality steel pipe in their oil and gas wells. There are over a million oil and gas wells in service in the continental US right now, many more are retired. Especially horizontal wells are 1 mile to several miles long. So to save 50 tonnes of steel on 6 launches per year is idiotic.
According to wiki SpaceX thanks NASA for a lot of technical help which Musk says was critical for development of their delivery vehicles.
Too much hype for a rocket that did not have a precise destination and ended up not even pointing in the direction it was supposed to go - i.e. the planet Mars. But hey the entire media says that it is the greatest thing since sliced bread.