[OOC.]: Jeez Amerigo, no way in hell could something like that happen in 1970. Cosmonauts and constructors/engineers were pride of nation and extremely valuable assets.
[No longer OOC]:
The sad state of Soviet space program after Korolev's death makes me believe it was a stunt/fraud hybrid. N1 wasn't ready, and wasn't getting ready. Program was mismanaged, started too late, and too diluted across various bureaus.
Do you remember that after Kremlin revealed names of cosmonauts killed in crash of initial craft, CIA was astound to have exactly zero information on them. As if they have never existed before. It wasn't after the launch of the spacecraft that it was cleared to public that it's manned launch instead of a unmanned Zond probe. And cosmonaut names weren't released until weeks after its "tragic" conclusion.
Now, it was confirmed much later that they were within USSR army and air force, but still, not a single trace of evidence connecting them to space program exists that can be dated before the official press release.
Imagine the following, they know they are loosing a space race, Glushko gives them slight probability that he might get a N1 off the pad in following months.
Now, in a armed service as large as Soviet one was, in three of four months enough screw ups and real fatal accidents will happen to provide bodies for the would be cosmonauts.
Remember, due to high speed crash, decompression and cycles of freezing unfreezing due to Lunar night and day cycle, by the time secret autopsies were performed at Bethesda Naval Hospital (and if that event was declassified earlier, we might not have ended with conspiracy theories as crazy as some running around in past decades), there was no way of determining exact cause nor time of death.
Regarding that fatal 1972 launch, whose casualties crippled Soviet space program for years, there is a little known incident (in West), released by Gorbachev's glasnost policy.
The Nedelin Disaster. A artillery marshal was killed in a early ICBM test with almost 300 other personal. Till 1990. it was believed that he died in a plane crash.
Safety with N1 tests was always low. Almost every on pad explosion or a in flight one during previous tests ended with people injured, occasionally killed. People were on long ends of their nerves, and safety precautions were lacking.
Now, what if that final LOK 6 mission was supposed to finally be a real flight. They had two flawless N1 launches before it, and a partially successful one before those. And they were urging to go, primary to redeem themselves in their own eyes.
Mostly everyone in project would be there for the launch, and now we know of most unfortunate positioning of those secondary fuel reservoirs that were to shallow underground, and whose connections to primary pumps had too little failsafes. N1 blows up on lift off, taking two cosmonauts on board and small number of engineers that were observing from far to close, shock wave screws up the valves on above mentioned fuel dumps, and they blow up, and wind takes fireball straight into observation row.
Never attribute to malice what can be explained with stupidity.