Jamest is right when he says most sheep in NZ NOT merino, and of those only some produce a fine enough wool to use for baselayer. One reason for the high price is scarcity. Not all years are good for wool growing. Next couple of years may well be bad as heavy snow hit at lambing time with a 300% increase in lamb deaths.
Cheap merino may not even be merino at all. Been told that in China either coarser merino wool or ordinary wool is treated with chemicals to make it feel like merino.
Genuine merino certainly isn't fragile. I've got tops I've been wearing for years and are still good. All made with MAPP merino/Zque and yes, it's certified and far better quality than anything else I've tried.
Howies isn't what it was. First it was taken over by Smartwool/Timberland, and now I hear by VF Corp. so it's a long time since they could claim to be using NZ merino. As for the "Norwegian" stuff - it's all made in China. Only two companies I know of that aren't are Arcteryx (Canada) and Chocfish (NZ) and both use MAPP merino.
The fact is that cheap merino is rubbish - the comments on here are proof - pay a decent price and you get quality.