Not sure what you mean by 'deal with a single conflict at a time'. To rebase or merge, you will have to resolve all conflicts that merge/rebase produce, right?
It's easier to remember the intended behaviour when the code changes are as small as possible, and when you have a (hopefully) good commit message to look at.
If you are concerned about reading history, then a merge can give you more context regarding the commits. With re base, commits will jump between features. For example, You are looking at commit for feature 1, but the next series of commits are for a bug fix in feature 2. Next series of commits belong to minor tweaks in feature 3..
Regarding the "rebase, commits will jump between features" part: that really depends on how you do things. On my projects, we use git flow. In such a scheme, every branch you would rebase, belongs to the same feature or bugfix.
Not sure if I made that clear. But I was talking about the result of the rebase. Once you rebase, all the commits that were in different branch ends up being back to back, and hence become interleaved...
Rebase is a hack? Rebase copies a series of commits on top of an immutable history at a certain point in time. This allows you to deal with merges a single conflict at a time, instead of dealing with all the conflicts at once with a merge. It also allows you to avoid cluttering your history with useless merge-commits when just syncing with another repo.
Merges have their place. I use them whenever I merge branches, using --no-ff so I can attach a "Fixes issue #77" in the merge commit message. Of course, before I do that, I sync the branch I'm merging into, then rebase on top of that (to have a clean merge). I might also rebase --interactive to clean up the commits of my branch, so that the history is as easy to read as possible.
Comparing rebase to rollback is wrong. Git has rollback (or revert) as well, and it's used for other usecases, like when reverting changes on a public branch (where rebase would fuck it up for everyone).
I'm sorry, but your comments make it sound like you don't really understand Git.