Was this likely caused by my stupidity?
I wouldn't go that far, but play in the stem/headset assembly certainly could have been a contributing factor. Just take a second to imagine to torque and force applied to that small area below the weld when you hit a curb or pothole if the assembly is not tight. The bottom of the headset is somewhat wedge shaped, and if the whole assembly is loose it can be like pounding up on it with a hammer each time you hit a bump. That said - it's a 10 year old aluminum frame and there can be myriad reasons for that failure.
Is this a dire mistake or should I ride it cautiously and check regularly it to make sure it's not spreading?
Considering that if this fails catastrophically at any speed you are likely to end up going head first into the pavement, I would personally not ride a frame with a crack like that.
It is possible to have a crack in an aluminum frame repaired by taking it to a specialty welder. That said, you could encounter a range of quality and durability issues with that repair. Add to that the fact that after the repair and repainting you will likely have spent at least as much as you would on a used but good condition frame, I would just replace it.
Is there anything I should consider doing to reinforce or protect further damage?
I would not trust my face, head or life to a homemade preventive repair. Junk the frame.