You can use a list of CROSS APPLYs to evaluate columns and concatenate values as you need to.  The great thing is that new aliases ("columns") created in a CA...

Check for INSERT triggers on the table being INSERTed into, just to be sure.  The error could be occurring in a trigger rather than for the main INSERT.

Sounds like you are looking only for a single match.  If so,you should skip the dbs after a match if found:

IF OBJECT_ID('tempdb.dbo.#stop_flag') IS NOT NULL

If the table resides in a separate db, then you reference the table you will need to include the db name, either...

No.  It's random which you get if there are multiple matches.  If you want a specific match, write your own code to do that.  For example:

Separate new filegroup(s) are fine, you don't really need a separate db, and you don't want to deal with the three-part-naming issues that a separate db would require.

Effectively yes.  If you're updating a single row in a non-columnstore table, then the main row (from the clus index or from the heap) must be read in order to...

Nah, ISNULL() in a SET is fine.  It's only in WHERE and join-related clauses that it makes a difference.