Yes, in the same way that 'literally' also means 'figuratively', which is to say that colloquial usage of the word is incorrect as regards it's intended meaning.
Whether or not that is a useful distinction is subjective.
I disagree. By surrendering the meaning of words we lose the ability to communicate precisely. That may well always be a losing battle, linguistic evolution being what it is, but that doesn't mean it isn't worth resisting.
Whether or not that is a useful distinction is subjective.