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"Uh, yeah, it was supposed to do that. We learn a lot from billion dollar failures."
People estimate ~100 million, which is still a lot. Of course it's worth noting that they weren't attempting to launch a payload or really recover much of anything, so the only real cost of failure is that they might need to launch more test flights later than they otherwise would have had to.
Apparently estimated total development costs are probably a bit less than half of the Artemis program cost, although the Artemis program has actually developed a fully functional and reliable rocket by now. So it's hard to say if SpaceX's development method will be cheaper in the long run. (Discounting the later manufacturing costs because I don't see any reason why a more ULA, Blue Origin, or NASA-like development process wouldn't still be capable of producing a cheap rocket if that was the focus)
Honestly losing to the US military industrial complex in development cost would be pretty embarrassing. (Congress makes NASA use all the MIC suppliers for their rockets)