Hi Raimundo, Thanks for your questions, here are the answers:
1. rebase and merge should work fine in the MQ. There are a few nice things you get from squash and merge like each commit that ends up on your trunk is associated with a PR and we can take that PR in the commits message. But if you prefer rebase and merge, it should work fine.
2. Currently, fast-forward merge will behavior as you described in Option 1. We have looked into Option 2 as well and will likely be an available in the future, but it is not currently an option.
3. Submitting a PR as a not currently an atomic operation. We will submit all the PRs to the merge queue in a single operation, but we will still merge them one by one. If an error is encountered attempting to merge a PR in the middle of the stack (e.g. CI randomly fails), it could result in the stack only being merged up to that PR. This is another feature that we are looking to add at some point in the future.