Rebar can be usable but you need to work it hot and don't quence it, just let it air cool. One of the problems with rebar is that when they roll it to put all the cruves into it there can be stress points that become cracks. I really prefer to use plain carbon steel, A36 for practice. It costs a little more than scrap but at least you don't put in the effort just to have it break.

If you really want some tough steel, get a NASCAR axle from Paul Garrett up at the Folk School. It is pretty amazing stuff. Best of all it doesn't need any kind of heat treat just let it air cool. I've got a couple of chisels made from it. I also made a pair of tongs from it. We'll have to see what happens the first time they get quenched when hot from holding something. I don't think that will be a problem though because while tongs get too hot to handle, unless you're not paying attention they should never get any color.
Also when you cut it use an abrasive wheel. If you try any kind of saw, the steel wins. Another thing I learned about the axle steel is that you have to work it hot. Once it loses most of its color it gets very hard to move and you can crack smaller sections like tong bosses. Wonder how I know that one!

I've tried the clay before. I always get frustrated with it when I use it. After a few minutes of being in my hand it gets to warm and soft and hard to work with. It's true though, it is a good way to practice. I have worked out a few things with it before working with steel. I've wondered about putting a bit of it in the fridge or freezer before working with it, but I haven't needed to use it lately, or rather I haven't brought myself to use it.

Must of the really high quality alloy steels are what is called vacuum degassed. The 'heat' (what a batch of steel is called) is first melted in an electric furnace. Once the chemistry is gotten to an acceptable level it is tapped out into a special ladle at a very high temperature, somewhere close to 3100 degrees. It has to be that hot because the next step. The special ladle has a machined surface that sits on top of a large O-ring at the top of a large sealed tank. In the tank is another ladle to catch the finished steel. The tank has been sealed and almost all the air has been pulled out of it creating as close to a total vacuum as possible. The steel is then poured out of the bottom of the ladle, through the vacuum into the final ladle. While the final pour is happening, additional alloying stock is added to get the chemistry to the proper level. The vacuum causes the stream to flare and any dissolved gases to be pulled out thus creating a very clean, fine grained steel.
Back in a prior career I used to work for US Steel in a steel producing shop. We made some fancy steels and some tie plate stuff too. It just depended on what the Production Planning department wanted. All the 41xx, 51xx, and 86xx steels were degased. The fanciest steel we made was HY80 that was used for Trident submarine hulls. We also made about 4 kinds of stainless.

Our electrodes were 24 inch diameter graphite and if I remember correctly the transformers were 470 KVA. We made 200 tons at a time from 235 tons of scrap. All great fun, fire & flame, heavy equipment.

John is right about the ease at which some steels can be forged. The tongs I made from axle steel were made at the Folk School using a power hammer. I do like them and may make another set next time I take a class.