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You're right, and the next frontier in genome assembly and mapping algorithms is using graph-based genomes, where differences between individuals or populations can represented as different paths through a sequence graph. (There are lots of better explanations with pretty pictures out there with a little searching)

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That's more of a representation problem, isn't it? I'm not seeing where it would require any new development to produce such a graph - just a lot of CPU time to assemble one from a collection of FASTA files, or whatever linear representation. (And a lot of wall-clock time, to convince people to use it...)

Right - It's not so much algorithmic development as development of the toolchains that will enable such representations to be actually useful for downstream analyses.

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