Q1: The benefit is that as long as you are connected to the internet, you can make the transfer. It doesn't matter if your bank or your police wants to stop you, you can do it.

Q2: Because when central banks become unreliable, or hyperinflation kicks in (Venezuela, Greece), trade using the central bank currency may become hard. You wouldn't transfer USD→COIN→EUR, but USD→COIN, and then use the coin directly.

Q3: Laws are not computer programs. They are ambiguous and execute in the brains of a few humans. Smart contracts are precise, and they require the entire population of coin users to disagree with the computed outcome.

Your conclusion does not take into account the case of not trusting government institutions.