Mad Honk, I wish I shared your optimism. The original design, which was a thick solid tube that was welded and (we think) not properly heat treated, broke. The seat post was extended properly (minimum insertion distance was observed). I'm skeptical about the remaining welds and or tube material.
Also, the tube is distorted, so I'm unsure that one could find a good steel tube or post that would fit into the existing seat tube, past the top tube and seat stay welds, with the close clearances you mentioned.
Of course (as others have said), calling up Rad and asking for a warranty replacement would be optimal (and if they really want to come out looking good, they'd offer one).
If the OP must try to fix the frame, I'd recommend grinding down and smoothing the jagged break, and would use a very long aluminum seatpost glued in 6 -10 inches (I'd prefer ten: this provides more lever arm for the thing). I'd use flexible epoxy (the West Systems G-flex). If the original collar was swaged down (so that the ID of the collar was 27.2mm and the ID of the tube is a bit larger) then you'd have to glue in 27.2mm ID shim tubes at the top of the remaining seat tube, and near the bottom of the new seatpost. Then glue the seat post in.
Getting this all set up to have glue joints that have enough surface area with that 0.005" clearance is going to a real bugger.
I guess you could try having someone weld it, with the gusset plates that dedhed suggested. But those gussets are welded on: you might end up with something weaker than the original.
I'd really, really, really suggest calling Rad and letting them know of this thread. If they get the OP a new frame, great. If not, well, the OP should share that info too.