Ah, with you now.
There might be something in your current policy which excludes damage to property more specifically insured on another policy, this would probably mean that "M&S contents only" would be more specific than your current house and contents, so only M&S would be liable to pay anyway.
Probably best to call your current insurers and ask them to take off the contents? You might get a small return premium (which might be outweighed by the admin charge!)
On the other points, it would only be fraud if r3g was claiming full amount from both policies, in order to be better off than he was in the first place. And subrogation is when the insurer, reclaims from the responsible party (in this case, would be the thief), not from another insurer.