"One of the fundamental differences between technology and magic is that two engineers do twice as much work as one would do"

This is demonstrably untrue; see http://en.wikipedia.org/wiki/The_Mythical_Man-Month.

"Engineers can, so the things you create with technology aren't comparable to the products of big companies,"

If this were true, startups wouldn't exist.

"I wonder if anyone can come up with a good argument as to why it is actually better to live in a non-personal, non-caring universe than in a caring one."

I think Eli's argument is that a caring universe isn't *necessary* for happiness. If he thought that the universe should *stay* uncaring, he wouldn't be trying to develop FAI.