Diffing is hard and there are many subtleties (e.g. https://github.com/microsoft/vscode/issues/164370).
The space efficient Myers diff algorithm has some problems when using it for merging, as tiny changes at the beginning of a file can cause a different path selection later on. Also, Myers doesn't minimize the number of hunks (only their total length), which sometimes leads to unnatural outcomes.
If anybody has good ideas for more advanced diffing algorithms, I'm all ears! (maybe even tree based ones, like difftastic) It's already very difficult to objectively evaluate the quality of a diff or to see if improving the diff for a special case doesn't make the average case worse.
As for the visualization of Myers, I can recommend to have a look at https://blog.robertelder.org/diff-algorithm/.