I actually could be wrong about what set Walt off - you're right, I'd forgotten about him getting enraged when Jesse'd cooked before. Walt had a hankering for the nazi's before, just because they stole his money and killed Hank. He would put two and two together instantly, realizing they were behind the product... On second thought, you're absolutely right and I'm probably absolutely wrong. With one caveat - it was a combination of the two. No Schwartzs, no "Walt Breaks Bad" moment. It was the combo of his prior life's work being stolen without any credit given, and now, someone's making his blue Meth.
As far as my thoughts on Grey Matter? I admit, I watched those episodes when they aired and not since. So maybe someone who discovered the show recently and caught up on DVD can correct me, but I walked away from those episodes with the strong impression that it was clear Walt was the brains behind the operation. Gretchen was his girlfriend at the time, who had the capital and resources to exploit Walt's work, but neither of those two were "chemistry geniuses." Walt was. Then, not only do they steal his work, but get insanely rich off of it and screw him out of even a "thanks, here's a million."
I also seem to remember the implication being that Walt might have gotten the cancer from whatever it was he was doing back then, although that one I'm totally unsure on.
Bottom line, we didn't really know what happened back then, true. But when Skylar went to Gretchen, she came off as a cold hearted nag. I seem to remember most vividly the party at their house that Walt went to, where he was treated like crap and as a second class citizen.
Now if they did steal Walt's work, I hold to my comment about their wicked ways. They are indirectly responsible for everything Walt did. I've long contended that Grey Matter royally screwed Walt over, and the grudge he carried for that led him to feel like he owed the world nothing.
Lastly, as far as Walt breaking bad the first episode? Absolutely not. Absolutely, absolutely not. This episode proved that - Walt was devestated and ready to give it all up after his son disowned him. I can admit to being wrong or misremembering a lot of things, not that. What else was the point of playing the show's theme music at precisely the moment the wheels began turning in Walt's head and he abandoned all hope? That was his breaking bad, finally. Before there'd always been a Jekyll/Hyde dynamic. In that moment, Walt died and Heisenberg took over 100%.
One thing I've been curious/upset by - nobody seems to tout the idea that Walt's gone crazy. I mean literally nuts... that this isn't Walt, thus the Heisenberg persona. He has cancer - has no one on the show considered maybe he's got a brain tumor? That's one thing that's really, really pissed me off these past two episodes regarding Walt Jr. - he's desperate to believe this man isn't his father. He knows his father has cancer. Is it that much of a leap to wonder if hey, maybe it spread and the guy's wacked out beyond belief?
Of course I'd find it hilarious if the ending has Walt locked away, with the entire show having been a delusion in his mind from a tumor. It won't happen that way, but the utter lack of anyone dangling the "cancer-tumor-brain-nuts" explanation on the show is... odd.