Your comments

The compact view option only is available for read-only Changes views. The File Compare is designed to be freely editable.

In your case I recommend to use a tool that simply fixes all line separators. This is, IMHO, not the task of a version control client.

The 17.1 preview intermediate build 11081 (Help | Check for Latest Build) let's you play with that feature. You can active it from the Changes menu, the option is named "Compact Changes Display".

Just click the Amend checkbox 1 or 2 times.

The color can be changed with the line

graph.merge.text=#808080

- at least in 17.1 preview.

When starting the interactive rebase from the Journal, the log should remain operational.

The reason is simple: the normal Journal just rejects the operation if there is a conflict.

It is also possible to open the log before starting the interactive rebase.

This is no general interactive rebase problem but one with your particular repository - most likely you have committed line separator changes unintentionally. Again, userecho is NO support forum.

What do you mean with "it doesn't work the same way as the Journal"?