The terms the two of you are looking for in your discussion here are Pareto efficiency, and Kaldor-Hicks efficiency.
Your point is that not everyone is better off, so destruction is not a pareto improvement. Their point is that on net, value is increased, so in theory the ones who are worse off could be made whole through a wealth transfer, and there'd still be a surplus, a Kaldor-Hicks improvement.
Your point is that not everyone is better off, so destruction is not a pareto improvement. Their point is that on net, value is increased, so in theory the ones who are worse off could be made whole through a wealth transfer, and there'd still be a surplus, a Kaldor-Hicks improvement.