Yes indeed, and even sillier was that the engines were built by an entirely different company in a different state. But that just goes back to why private money is smarter - it's not allowed near senators who each want their slice of cake. The current SLS (waggishly called the senate launch system in some circles) has had most of its major technical decisions made on the basis of politics - eg having to use shuttle derived solid rocket boosters to keep that factory open. I think Apollo only got away with it because money was no object.
Again I think this is where the strength of SpaceX lies (modulo the obvious like hiring smart and/or very experienced people) - they are quite free of all this nonsense, their PMs and designers and fabricators are all under once roof and can close the loop on design and manufacturing feedback and iteration. It's very much like skunkworks back in the day.
Having said all that, they're not immune to interference. Dealing with NASA and the ISS means you have to renormalise what constitutes 'exciting' and 'newsworthy' so where in the early days we had things about engines tests and re-entry tests, now we get releases beginning with sentences like 'Today, Space Exploration Technologies (SpaceX) announced it has successfully completed the preliminary design review...'[1]. I've worked on projects with which NASA or ESA have suddenly got involved and I've seen first hand how the innocence get lost, you go from running to wading through treacle, and you have a bizarre out of body experience where you sit in on one of the meetings and wonder how it has taken three hours for them to agree that a decision should be made about something (but not actually make a decision).
If you've not read skunkworks, I'd highly recommend it. A lot of it details how one of Kelly Johnson's key strengths was being rather brutal to his 'customers' (DoD usually) to prevent their incompetence, expense and geological timescales leaking into his outfit. I can quite understand this offensive form of defence, having seen what government tentacles can do to an otherwise good project.
I'm not sure I'm comfortable with the implied assertion that the Saturn V was the product of senator meddling (absolutely no argument with the shuttle however). The Saturn V was a von Braun rocket, and as far as I am aware was designed with a similar mindset as the earlier Saturn and Jupiter rockets. (It is my understanding that) they basically made it as good as they could as fast as they could, damn other considerations.
So basically the Saturn V used LOX/RP-1 in the first stage but LOX/LH2 in the second and third because that was the best configuration, but SpaceX is using LOX/RP-1 in all of them because it's simpler but it gets the job done. (note that SpaceX is apparently considering developing LOX/LH2 upper stage engine for heavier loads: http://en.wikipedia.org/wiki/Raptor_(rocket_stage) )
Ah yes... but what did the second stage have?
Not more F-1's, but J-2's, which did not even use the same fuel! Compare this with the route SpaceX is taking: http://en.wikipedia.org/wiki/Merlin_(rocket_engine)#Revision...