I'm responding a bit late to this, but anyway...
Your definition of materialism is not what the term commonly means. Clearly we're made of matter and have material concerns; everybody is a materialist under that definition. Materialism-as-commonly-defined goes much further and says that matter, and therefore material concerns, are all there is. Quite different.
The telos is nothing mythical or hooey. It's utterly anodyne: it's what a thing does, or how a thing acts. The telos of an acorn is to grow into an oak tree. The telos of water (one of them) is to dissolve salt. We know this because if you put salt in water, the water dissolves it; it doesn't turn it into sugar. Dissolving salt is what water does. The fact that we could describe the chemistry of how this happens in far more detail doesn't undermine the point. Nor does the fact that water has more than one telos. And if you say this is trivial, I almost agree with you: it's supposed to be.
Materialism is objectionable (as it pertains to this discussion) because it denies the telos, by saying that everything can be defined in terms of matter, and nothing else. This is a mistake: the telos cannot be reduced to matter. "What a thing does" is not the same as "what a thing is made of". Even if you want to say that the former is entirely caused by the latter -- which I would not entirely disagree with, though I'd want to clarify -- it does not follow that the former is the latter.
Human beings, like everything else, have a telos, which is happiness.* Happiness in this context doesn't mean an emotion, in the way that most people mean it. It doesn't mean delight, pleasure or even joy, although all of these result from it. It encompasses notions such as flourishing, or fulfillment, or beatitude, or rest, and still can't be reduced to any of these. A proper discussion of it would take too long. But everybody wants to be happy.
Unlike acorns and water, we can choose whether or not we move towards our telos. An acorn may fail to grow into an oak tree, but it obviously has never has a choice in whether it does so. If an acorn is crushed, it probably won't grow into an oak tree, and is to this extent a bad acorn. By contrast, a human being can choose his actions: he can choose actions that tend towards his telos, or that tend away from his telos. A deliberate action is good to the extent that it brings about our telos (which is happiness), and bad to the extent that it fails to do so. This is both 'morally good', and good in the more general sense, in that sense that an acorn or even a car is good.
The great grandparent's point was that if you undermine telos, you undermine any objective basis for morality. And this is true. It isn't even limited to materialism. If someone says we must follow God's commands, he can't explain without telos why we must do so, though he may describe incentives for our doing so. Morality would still be absurd.
That's what I mean when I say "truthy-sounding". It seems to wrap things in a nice neat little box, it certainly sounds profound, until you really look at it and realize, oh no, that didn't solve anything.
I'm not sure what you mean by this. Nobody is saying "we know about telos now, we don't need to investigate anything else". Least of all Aristotle! Nothing in the notion of telos undermines the need for empirical investigation. If you can show me a line of Aristotle that even hints at this idea, I'd love to see it.
* I take some issue with the grandparent's definition of happiness, but I think we'd both agree that happiness is humanity's telos