I do know the history of that block, and have been subscribed to the relevant mail lists for bogon filters since 1998. It has never been a good idea to start using a currently unallocated /8 for internal purposes, when plenty of rfc1918 space exists. 1/8 is not the first block to ever be taken out of the bogons list and actually used. Some of the "newer" /8s that were in the last few handed out to the RIRs also had reachability issues when arin, ripe and APNIC started giving out /14 to /22 sized pieces of space to ISPs, because a number of people out there had stale bogon filters handcoded into their routers. It is mostly fixed now.
Yeah, no. It sounds like you don't really know the history of that block. Or maybe you missed the part where I said it was used as a loopback address. Maybe both.
1.0.0.0/8 was unallocated and was also part of many peoples bogon filters at their edges.