Ed - I generally agree. But I feel the panic is a bit high.
A diamond on a metal base that is spinning contacts the work for a very very short period of time. This assumes the tool is spinning and the diamond isn't massive...
I'm assuming a 'point' of fine atomic level that diamond can do. It is the touching / grinding on a fine point. [ remember the Garnet sanding sheets that shatter as they impact and stay sharp ] diamond is tougher and stands up to higher pressures.
The 'nano'-second it touches the work it will heat up but starts to cool down as the cutting arc is swept. The diamond wicks the heat (being the best conductor - far better than metals) to the work base metal the diamond is loaded into. Which gets hot. (a little anyway).
If coolant is supplied as in mills this would help.
Normally diamond is to expensive to use in a normal work area, other materials have been developed. Even special process of near zero degree work has been developed for some applications.
Saw blades have diamond pressed into slots on the circumference. These slice through rock and cements... I have sliced through tons of material. The diamond doesn't absorb into the host material (the tool) but I suspect the very highest temps are only at the tip where atoms are stolen.
Is it simply a matter of cost ? - the carbon is absorbed a little and the tool becomes used up?
Maybe the data is simply old economics. Diamond drill heads bore through iron cobalt deposits and other iron rich layers for many years in well drilling. So maybe research needs to look at this again with a different point of view.
Martin