If you quote post a thread now it doesn't merge the thread. Anyone reading the original thread doesn't see any of the posts from the quote thread right now. If you wanted to you could inline quote posts from another thread but aside from that being time consuming if you abused it people could mute you and not see any of those posts. If there is an actual merge functionality those posts would all look like someone elses posts rather than yours so muting you wouldn't have an effect.
With this merge flag how would this work? You put in a merge request and the OPs of the threads you want to merge have to approve it or are you saying that if I don't approve I don't see the merged threads, but they still merge?