The real lunacy is using chemical rockets instead of nuclear thermal once the ship is in orbit. That could reduce the fuel requirements for an Earth - Moon transfer by 4x. And this isn't some sci-fi tech. NASA built a working engine in the 70s.
Kind of. No NTR has ever been flown and tested in space. The program achieved many milestones and got pretty far into development, but was cancelled 50 years ago due to budget constraints. It's always the last 10% that are the hardest in engineering and while NASA (as well as the Soviet Union) got 90% there, it would still have taken a few years (maybe just two) of further development.
The real lunacy is simply not being mission-driven. A true mission driven design would have used a simple, reliable option using proven and existing technology. Like non-cryogenic fuel for example.
Hydrazin might be highly toxic, but its beneficial chemical properties make it a much better choice for moon missions. Long term storage wouldn't be a problem and reliable proven engines already exist, too. In space (LEO and beyond), the toxicity doesn't matter while its use as a monopropellant makes it ideal for the ascend stage of a lunar lander due to reliability and simplicity.
Proven technology that existed for many decades - no new engines required, no complex refuelling in orbit (just send filled tanks into LEO and keep them there for later docking), cheaper, less risk, safer...