I don't claim to be able to tell what broke from your description. It's just a pet peeve of mine and a good guess. I feel it's just as likely as the theory that grit destroyed the hub.garegin said:but isnt the axle part of the hub?
Cheap MTB hubs are a bit too fragile for serious use. Their design is quite similar to lower end road bike hubs of the '70s. If I had one, I'd try not to ride it off any curbs or do a lot of jumping unless it's one of the cheapies with suspension, in which case it might be ok.
Since well-adjusted bearings can keep an axle from bending, maybe grit could contribute to axle bending because the wear makes the adjustment open up.