While a neat picture, as I understand it the itchiness of wool mostly has to do with how long the fibers are. With short fibers there are lots of fiber ends poking out of the fabric everywhere. Alpaca or merino wool has much longer fibers, avoiding this issue.
Pretty sure you're right. The scale on wool actually gives it some of its desirable properties I believe, like being able to cling to itself for easy splicing and felting.
So scratchy. When I lived in the barracks I used shirt-stays to keep that blanket nice and tight for any inspection. I kept a cotton comforter in my wall-closet and would toss it over the made rack and just sleep on that with a second blanket over me. In the morning both would go back into the locked closet and I'd still have a perfectly made rack after some slight straightening.