This has been an issue of great debate before in my long career, but here goes . . .
JimCasey,
Re: "However, if you just recirculate the fluid, any heat not dissipated though the walls of the system goes to heating the fluid in the system, and ALL of the energy consumed by the pump motor eventually goes into heat."
Not true. Remember "lost work" from thermo class? I quote from Balzhiser, Samuels, and Eliassen, "Lost work is defined as work that could have been performed but was not because of dissipative effects ot irreversibilities.
Whenever an irreversible change within a system leads to the lowering of an energy potential (such as pressure, temperature, electrical potential, etc.), without transferring as much energy to the surroundings, in the form of work, as possible, lost work results and entropy production occurs."
For example, instead of two orifices in series, what if jamieg1 installed the exact length of 1" line and fittings to drop the pressure from 1000 psi to 300 psi? Would ALL of the energy consumed by the pump motor eventually go into heat, or just 30%? Look at it another way. Assume you have the same flow of fluid in an identical 1" pipe and fittings going from point A to point B. Would ALL of the energy consumed by the pump motor eventually go into heat, or just 30%, between points A and B? 30%, right? In this context, it's a no-brainer. The potential energy gets dissipated by friction with no appreciable temperature gain. The same holds for the previous 1" pipe and fittings and two orifices in series. Only 30% is lost to heat. The other 70% is lost to "lost work".
Good luck,
Latexman