Drinking only blood would probably give you iron poisoning. Then there's the question how did the enemies make it all the way to your hole in the ground without any supplies
There's just so many leaks in this plan I don't even know where to begin. Any real desert settlement would invariably be based around an oasis. Just add those into the game and deserts aren't a total waste
Reclaimers and hauling water through the desert are negative sum games. A donkey drinks 1 gallon per day, travels 30 miles per day, and can haul 30 gallons worth of weight. For 20 dwarves (drink 1 gallon per day, reclaim half) living 300 miles into the desert, it would take one donkey every single day to bring enough in, and that's not counting profit or the drivers or anything.
Crude reclaimers could get what, 5 gallons of water from a human (on the high end). (Reclaimers always seemed like a violation of conservation of matter to me. In order for it to work, the water lost to evaporation (sweat, plants) has to be regained somehow. It's like putting a bandage on a splinter when you've got a gunshot wound
The original argument was 'if we make booze require water, and plants require water, nothing could survive in the desert'. Nothing is stopping people from being clever (carving out underground rivers, for example), but I don't think we should go out of our why to make it possible for non-clever people. There's a plate of gold? I'm sure they'll find a way to get water there, but that doesn't mean that we have to magically warp the world to make some special case work.
Hell, people are already building cross world aqueducts...
Firstly, on the note of iron poisoning, it is possible to pull the iron out of the blood with a very weak magnet. Magnets can be easily made as well, by taking a piece of iron, facing it due north, and hitting it repeatedly or by constantly rubbing a cloth on it to build up charge. Also, electric currents can create a magnetic field, and considering mechanical power is already implemented (though not fully developed, obviously) then it might not be a far step to electrical power. Though whether or not the game gets THAT in depth is another question entirely.
Secondly, it doesn't violate the conservation of mass or energy if you are using coal to burn underneath the basin into boiling out the water from the blood. Granted it wouldn't be very efficient of a system most likely, but it would still extract water none the less.
You are right though on the point that unless you had constant invading armies to slaughter and drain, then the practicality of it is short lived when you have to water every head in the fortress.
And on the note of reclaiming sweat/urine, well, yeah, water would definitely be lost there in some form or another. Not to mention it would be broken down to facilitate other bodily functions.