From what I understand, Musk as an already wealthy man would be able to easily protect his personal assets if Tesla were to declare bankruptcy. He would be fine, employees, living paycheck to paycheck, would not be.

And that appears to be another non sequitur. It was Elon's personal assets which caused those paychecks to exist in the first place. Elon has risked over 100% of his personal wealth on multiple occasions and there are moments in Tesla's history where if the company had failed, Elon would have fallen back into deep debt.