1. When did they merge? I know it was possible to use blockchain.info for logging in sometime earlier but not anymore
It wasn't merged, it's the same blockexplorer and online wallet service but with updated features.
They just got access to the '.com' domain and redirect '.info' to it.
2. Was it possible to use Bitcoin address as an ID? If so, what was the principle behind it? Was it possible to use
just any address i.e. 1BitcoinEater..... as your log in info or was it only possible to use an address that was provided to you by the BC wallet?
No, ever since the start, it's the "
Wallet ID" or in the earliest versions, via "
Alias".
Login using Email was just added recently.
If you mean, pasting the address in their blockexplorer; no, that's not a log in.
It's only meant to search for that address' transaction history and other info.