And, by what you have conceded, no need to buy a carbon frame either.

Like another recent theme, you can't just cherry pick an environmentally friendly practice while ignoring the greater, more logical and applicable options.
Well, you can, but it lessens your argument.

Reusing or recycling already existing products is always more eco freindly than creating a need for continued production (no matter if it is less polluting than others) by purchasing new. Almost anyone really serious about environmental issues accepts the over arching concepts of reduce, reuse, recycle. By refurbishing an existing frame you reduce production related impacts.

Will people continue to buy new bikes? Of course. We still continue to fight after the "War to end all Wars" but if you really want to adopt the high moral ground of environmental concern you ought to try to lead by making smart choices.