A lot of what you say is true, though there's more to it than that. Yes, Tobruk was inadequate as a supply port, as were Sidi Barrani and Marsa Matruh. However, Rommel constantly pointed out that this was because there was no initiative to actually develop the ports there into full supply hubs, just as there was no initiative to properly defend them from air attacks. This lies mostly with the Italians, who were designated to develop the port's capacity, and simply failed to do so. Don't get me wrong, the Italians wrongfully get a lot of flak for not being competent in battle, which is not true when it comes to Africa, but when it comes stuff like this they really messed up. The same goes for the railway: an Italian railway was meant to have been constructed in the area since 1941. It never was.
The problem here is that people like Rommel think it's really easy to improve a port and make a railway; when in reality that would have eaten up most of the port capacity that was supplying the Afrika Korps to begin with. Tobruk was bringing in maybe 200 tons a day - all of which needs to go to the Afrika Korps or else the men start starving to death. That leaves no room for any port-improvement supplies which in any case will take months to complete.
The only port that had any sort of excess capacity was again, Tripoli, and we're talking about inching a bloody railroad through one thousand kilometers of desert.
That's the reason why the OKW knew Rommel was crazy. He's pretending you can make a port and a railway just by waving a magic wand, when in reality to expand the port and railway will take months and the Afrika Korps would have to stop fighting in the meantime so that port capacity is freed up to bring in the materials needed to improve the port/railroad - because there aren't any factories in North Africa building railway tracks.
Rommel correctly calculated that the only way to gain a victory in Africa was to destroy Montgomery when he was still shattered. A lot of people also don't realize how close he actually got to Alexandria.
Geographic distances are pretty meaningless if you can't hold the real estate due to lack of supplies. The Germans for instance got to Maikop - which is deep in the Caucauses and was a city that could have supplied the Nazis with enough oil forever - but the Soviets simply demolished the oil rigs and there was simply no way to get drilling equipment thousands of kilometers through the supply chain to restore production.
Regarding the 'mountains of supplies' in Tripoli, this is the first I've heard of it...
It's supplies for both Afrika Korps and the Italians. There's no difference between the two given that the most important of the supplies were fuel anyway. This was why Tunisia didn't collapse so quickly in the first place - Rommel had supplies again as soon as he abandoned Egypt and Libya while the British soon outran their own supplies.
The OKW believed Africa was a distraction, and I very much disagree. The British resource-rich possessions of the Middle East were defended by eight divisions that were far from battle-hardened. Taking Egypt and beyond meant taking the Mediterranean, which would have greatly alleviated the supply 'issues' for the Afrika Korps, not only because British sea and air power would be diminished, but also because Alexandria and beyond were proper ports. i.e. the Italians would not have had much excuse to fail to cooperate anymore. There was already anti-British sentiment from the local populations, so breaking through Montgomery would have been the last difficult obstacle course towards British oil. And I do not believe that it would have taken much more to actually win El Alamein–just the Italians properly handling the supply situation, and the OKW keeping its promises. I'm gonna stop talking about the potential of a victory at El Alamein now, since counterfactuals almost always get out of hand.
No, the OKW knew that taking the Middle East was completely insane. The Middle East was NOT a major producer of oil yet at the time - not as big as the Caucauses or even California; and this again delusionally assumes the Brits won't just blow the wells like the Russians did at Maikop.
The Middle East only became the major oil producer post-war; and only because of purchase of a lot of drilling equipment from America (Germany had almost no excess drilling capacity, since the idiots were importing most of their drilling equipment from America pre-war, couldn't make a lot of their own, and what was left needed to go to Ploesti). And in any case you're advocating stretching an already insane supply line of 1000 kilometers to something like 2000 kilometers to reach Arabia, while the Soviet Caucauses armies are just waiting on the flanks ready to pounce.
Rommel's plan was simply insanity on the strategic level from start to finish. It doesn't matter if the Brits only had 8 Divisions. The problem is ultimately one of supply, geography, and the fact that even if you beat those 8 Divisions there are 20 more Soviet Divisions in the Caucauses.
Finally, it's worth noting the supreme irony that there was in fact a lot of oil underneath the desert the Afrika Korps drove over in their vain quest to Alexandria. The Germans simply never found it or exploited it because, again, their oil industry was a shambles that was dependent largely on American equipment and expertise. The "oil offensives" were really a prime example of wishful thinking rather than any realistic solution to Germany's oil problems.