I'm not gonna place doubt on the damage of the bag, but I think the big questions are: How were you in a position to see everyone as they were boarding, if you were seated in 1b, (Were you standing the whole time?) and 2) I think you should have addressed the FA about the bag abuse, if you watched them cram items along side your bag that may have caused the damage, and also gotten the name. It doesn't matter if it's a busy flight or not, it's still your personal property and should be treated with care.
You did the right thing by immedietely taking it up with Baggage services, but you should have also filed a claim, by explaining how the bag was damaged in the first place. I'd write a letter to Delta customer service department, given dates, times, flight numbers etc, explaining how the bag was damaged and the cost to replace said bag.
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