Very confused rank newbie looking for advice

You pretty much got it so far according to your summary. It kind of boils down to this:

- If you have to have and FPGA for reasons other than a CPU core, then NIOS should be considered as an option.

- If you are adding the FPGA just to have a CPU core, you have too much money or you work for the government.

Keep in mind that with an FPGA core, once the peripherals are debugged, it becomes an asset that you can build on for later projects, just as you would a DLL or shared object in the software context.

BTW, OTS solutions work great out of the box until you start adding your own drivers and such, then the fun begins... kernel re-compiles, build tools... you will have to deal with this in NIOS development too...