Newer coolers are definitely better at holding temps but....they cost and you may not need the temp held for as long as you think. Give yours a try with just water and see how much heat you lose in an hour. Try it a second time with a blanket folded and laid on the top.
The quality of your crush will determine how long you have to mash for as with a coarser crush it takes longer for the water to wet the grain to the middle of the pieces. When you crush (or grind) finer, the size of the pieces is smaller and they get wet to the middle very quickly. The actual conversion once everything is wet only takes 15 to 20 minutes. The problem with that is that your very fine crush will cause problems when you try to drain the sweet wort out as they tend to clog whatever screen you use to filter.
This is where the BIAB system works well as the large surface/fine mesh eliminates the plugging. There isn't any reason you cannot combine the advantages of BIAB with your cooler, just make a bag from Swiss Voile (sheer curtain material, Walmart has curtains you can buy to make one) that fits in your cooler and put your grains inside that. When it comes time to drain, you can just lift up the bag for the filtering, drain the first runnings, drop the bag back in and add sparge water, lift and drain again. Or you could just learn about the BIAB system and use the cooler to keep your beer cold.