Yes I've done it and it's lovely  

Engineered wood is real wood. It’s just the planks are made differently in layers but the veneer on top is real wood. You have to use it as it’s able to bend with the heat without splitting. I think most wooden floors are engineered wood and you won’t be able to tell the difference anyway.

Yes, your builder is correct.

Solid hardwood will crack pretty quickly.

How it feels underfoot is more about surface preparation? It sounds like you want a more rustic surface finish. These are available in some brands.

You also need to use a flexible adhesive to allow for the differential movement of the floor substrate.

Good luck with the project

I had planned on putting underfloor heating in our hall and living rooms but our builder is telling us that it would be better to use engineered wood rather than real wood. Could anyone tell me if this is the case? I prefer the feel of real wood but obviously don't want to put in something that will damage easily.