Since you want to touch on this ... heck, I have karma to burn, so why not?
Third, please find me a free market today that works the way the model predicts, and isn't literally destroying people in the process, merely to maximize profits.
As you well pointed out, this is not a realistic option. And the cause is simple, profit maximization misalignment with other motivations - in fact, it's inherent in free markets, where competing interests (for profit) motivate everything. Hence various side effects like negative externalities, worker exploitation, slavery, and so on.
My personal take on this is that while a real-world free market would be a system with too much complexity and chaotic behaviour to represent in a general model, simplified models with free-market rules can easily show ways in which the system reaches ... inefficient outcomes, like unfortunate equilibrium points (such as monopolies) or destructive oscillating behaviour (boom-bust cycles). It does not even require human flaws to get there, game theoretical models with rational agents will reach the same problem, due to inherent limitations such as imperfect information and unstable equilibria. Socialism in turn, besides not really being the alternative, has its own issues, some specific and some not so much (the unstable equilibrium of requiring every participant to have motivations aligned with a common good for one). The tricky part is, imho, the fact that legislating the market is not a true solution - introduce into the game the motivations of legislators and the issue of technical expertise required for tuning the system and you'll just run into a different 'who watches the watchers' class of problems.
To close this rant, IMHO markets need to be seen through dynamic models where there are often (if not always) segments to be watched for developments of bad outcomes - and I'm including regulators in the definition of 'markets'. Having a blind faith in either 'free' or 'regulated' is a lazy man's easy way out of an argument that is too complex to tackle, as market efficiency is something that requires vigilance from all participants, much like liberty.