There exists a spectrum from full keystroke history to squashed commit. Squashed commits throws away information. It is lost forever. Full keystroke contains all that information information but it is incredibly noisy. Per commit state snapshot is a pretty happy median. It doesn't tell you all the things that keystrokes could tell you. But it's very easy to use. And tells you a lot of things that squashed commits does not.

The obvious answer is to squash commits, but keep the information. Intermediate commits aren't needed very often. But they can be exceptionally useful when they are needed. Especially if the commits were from an employee who is no longer working at your private company.

Git still needs a p4 timelapse view tool. It's wonderful. All that tool needs is a little check box called "expand squash". That's the best of both worlds. Everyone gets what they want. But that tool and checkbox don't exist. So given the choice between squashed vs unsquashed I'll take unsquashed 100% of the time. At a private company that is. Open source projects, especially large projects, might choose differently.