Overclocking i5 3570k (Specific Case)

Overclocking is always a gamble. It is possible you simply have a slow chip. 70 degrees is not all that hot. Unfortunately, it appears you simply have a slow processor.

Like stated above , all chips are different , it's the luck of the draw.

If your psu isn't putting out enough power, you would know due to system instability and components not functioning properly. Happened to me once, thought I was just crashing until I tried to use the CD tray and it only opened half way before it stopped getting power while comp was still on :0 So much for swapping an oem power supply from one comp to another and crossing my fingers.

As per your question, 1.2v is not dangerously high. People will tell you to back off of anything 1.3 and above on air, but as long as your chip temps stay low you can keep raising the voltage incrementally. Unless you really know what you're doing and have some custom cooling solution going on, your chip will surpass 90C before you get into dangerous voltage, in most cases can't say that it is always true as I am sure there is some monster good cpu out there that can pull it off

What would affect your computer more than a weak psu would be a weak power connection. For instance I live in a small town with old powerlines, that can cause instability and fluctuation on the power coming into my house. That can really mess with a system unless you get a voltage regulator or a ups.

On topic though, Yeah it sounds like you got a bad chip. You could invest in water cooling to try to get more out of your chip, just make sure to read reviews before making any purchases at all in that area as it seems pretty sketchy to me. Dangerous core temps for Ivy are, well you don't want it running consistently over 75C I guess. If you take care and apply good thermal paste with a good cooler you should be able to get your current OC higher without messing with over-temps. Your voltage, well that can go as high as 1.35 from what I see in people's every day clocks.

Finally, you would never be able to get your chip swapped because it doesn't overclock well. You would have to sell them some story to get that passed through.
If you are uncertain about all of this stuff, the answers to any question you have pretty much should be buried somewhere on this forum, so start reading and learn about what you're doing. The more you learn about OCing the more interesting it gets and the better you'll be at setting them up to get the most out of your system!

EDIT: Just read your OP about using the automatic overclock to 4.2Ghz. Chances are if you did that OC manually you would have a much better voltage than 1.344V. That's the reason people around here don't use automatic overclock, it doesn't set you up with the optimal numbers, it sets you up with numbers that "work". Try raising your multiplier until system is unstable, then raise your offset until stability returns, then raise multiplier again, then raise offset to correct stability if you need to, so on and so forth until either a) You are happy and comfortable with your overclock,or b) Your temps get too high i.e. above 75C stress testing.

Your chip probably isn't going to let you to 4.4 though with reasonable temps - at least not unless you get water cooling. And when you get that bluescreen raise your offset by another .005V and try again. This is a long process of getting the clock speed up and simultaneously correcting V to stop the crashes, blue screen means not enough voltage.

Honestly, I couldn't tell you - when I learned to do it I never read through offset, I did all manual and switched back to adaptive at the end.

The only things I changed were cpu multiplier and also set my core voltage to manual override, then set it at 1.200V and set my clock multiplier to 42, from there if system is unstable through a stress test you increase manual voltage to 1.210V and test again, keep this up until stable and once stable increase clock multiplier again by 1, stress test, increase voltages as necessary, increase clock multiplier, ect... All the while watching cpu temps. Changing the offset is ehh for haswell because we have adaptive voltage settings, previous gen boards didn't offer this so people used offset for long term overclocks.

Do it manually then once you have your stable clock and are done with your stress testing, try setting it to adaptive. If at that point things don't function the way they should, at that point I would say do it with offset but it will be far simpler as you will have your end goal stable clock multiplier and voltage already.

Edit: It can also help to set your cache frequency multiplier to the same as your core cpu multiplier, and set cache voltage to the same as cpu core voltage. Beyond this, be sure to manually input your ram clock speed and voltage. Either look on your ram packaging or look up your specific ram chips online to get their default clock and default voltage, then put this info in to the UEFI. This will help stability. If your ram is factory overclocked(i.e, any ram clock above 1600) You may want to consider turning it back down to 1600 to help you keep a stable overclock.