Still needs a dockerfile

/cc @michelleN

'-f' is depreciated

This fix supersedes #323. It applies basically the same fixes:

- local docker registries are now supported
- kubectl is not downloaded on every build

Also, added a fix for the case where `docker version` failed because the
Docker daemon crashed, and consequently spuriously propmted the user to
re-install docker.

I added support for $DOCKER_PROJECT instead of just $PROJECT because the
later is a little too generic for a shell env var. We can deprecate
$PROJECT later.

I did not add back in the better tool checks in bootstrap because
CircleCI doesn't have the `command` command.