The downside is if you select & delete two functions, and I concurrently insert a new function in the middle of that range, then the merged result will delete my function. Thats a really bad outcome - but its pretty rare in practice.
A much more common case is, I deleted 2 lines of code and you modify a parameter in one of those function calls. In this case, using range deletes your edits will also be deleted (which is what we want). Using individual deletes, the result will end up with some random junk left behind, in the form of whichever characters I typed.
When we're editing code as plain text, I don't think there's any such thing as perfect here. For asyncronous collaborative editing (like git), I think generating conflict markers & human supervision for merging might be the best answer.
I'd love to see someone make a prototype editor which can do AST-level concurrent editing. That would be super interesting in a bunch of ways - like, you could use the AST to do syntax highlighting in any editor too. But I'm not sure how it'd merge code when the parse tree is invalid - like, if I remove a closing brace (}) early in the function, what happens?
There's a lot of cool ideas in this space. I'm excited to see people explore them as CRDTs get more popular and more mature.