On Mars they can make methane with the Sabatier process.
So you have:
- LEO/MEO - vulnerable to asteroid impact ejecta
- GEO/moon/L-points - avoid ejecta, but need regular refueling. If Earth is toast, there goes resupply
- Mars - close enough to the sun for solar, able to conceivably bootstrap in a few centuries
You can split water into hydrogen and oxygen using electricity from sunlight.
In long term, most likely both Hydrolox and Methalox will be in use.
Ceres also seems to have a lot of water: https://astronomy.com/news/2020/08/ceres-an-ocean-world-in-t...
Putting more material between you and radiation by burying into the ground is a good idea, especially when your concrete-pouring capabilities are limited.
None of that is true in space, unless you're thinking of something I'm not, but like another poster has said, none of this is zero sum. The technology developed to try to settle on mars can be devoted to building large, habitable objects in space if people think that's a better plan. We should also have a moon base, etc. etc.
It's more sensible if you plan to keep a bunch of people there with constant supply from Earth. Elon wants to build a *self-sustaining* city on Mars. There isn't any other choice of location, be it man-made, or in the solar system:
- that has enough resources, atmosphere, gravity, water to allow a non-trivial population to survive without help from Earth
- that is hospitable to life
I suggest you watch his previous presentation where he talks exactly on why Mars is the destination, and not somewhere else.
Atmosphere is possible in man-made structures.
Gravity can be simulated in man-made structures.
I don't believe water is particularly scarce, and it is reusable except for when it's used to create fuel.
With the Sun + plants a lot can be done.
Mars, on the other hand, has low gravity and is far away from the Sun.
The resources still need to come from somewhere. Either we mine them on Mars, asteroids, or the moon. Mining is a lot easier when you have gravity you can push against to apply force. Rather than move the resources off-body though, its easier and cheaper to use them directly in-situ.
Of course, we can (and should, eventually) do both.