I don't think "admitted" is the right word. It's not like it was a secret - it was what they were explicitly ordered to do. The S-1 stage was, from the very beginning, a crash program to develop a 1mil lb-thrust stage in a very short time period and with very low budget, which is what led WvB to reuse the hardware and tooling from the Jupiter and Redstone rockets, primarily the former. So I don't think anyone had illusions about the S-1 being an optimized stage - it simply wasn't, and everyone knew, but that's not the worst thing in the world. Mass fractions matter way less for first stages, and I believe the S-1 stage held several perceived advantages in cost and ease of manufacturing, not to mention keeping a large aerospace contractor employed. So overall, very much an example of performance not being the only important thing in the real world. There's a lot to read about it in that chapter of Stages to Saturn.
Regarding replacement, the ETS Saturn 1C is notably implausible. There was never a proposal for a single F-1 powered stage. They were much more interested in the INT rockets which promised to cut costs by minimizing the number of stages that had to be kept in production. The S-1B stage, which shared no commonality with the Saturn V, was pretty much always going to be the first to go. Out of all of them, only the INT-20 (with reduced engine count) seems to have held any real promise. The transfer of flights from the S-1B to S-1C stage would also help reduce the unit cost of the S-1C. I think the ETS style Saturn 1C only makes sense in a world where NASA is committed to abandoning the Moon and Saturn V, and of course IRL we got the Shuttle as a result.
We realized the J-2A-2 performance assumed some sort of nozzle extension, which led to me creating the separate J-2A-2 part with the animated extension. The variant in the J-2S model was subsequently commented out.
Oh, also, since I've been meaning to respond to this for like a week - yeah, go for it! If you just make a pull request with the updated cfg we can review it and merge it in. I'm sure whatever you have is better than the current cfgs which I don't think have been touched in years.
On that note - yeah, if anyone has personal compatibility cfgs they've made? Please feel free to share them / make a pull request, we're happy to redistribute them so that other people can take advantage of them.