As for Rick, he gets 10 points from me for being a douche in this ep. I get that he is torn and trying to save as many lives as possible, but his plan was flawed from the start. Merle saw right away that he wouldn't go through with it, but by the time Rick actually backed out, it was too late to call things off. By then he was missing two of his strongest fighters and putting the life of Daryl (his only other fighter besides Glen) at risk to get them back. On the eve of going to war with the Gov, his actions were complete lunacy imo.
This is not entirely Rick's fault. You could tell over the last few episodes that he was undecided about handing over Michonne. He even told Hershel that he was hoping he could talk him out of it. Sure he seemed like he had finally made up his mind this episode, but it was evident (to more than just Merle) that he wouldn't go through with it. If anything, the worst thing he did was tell Merle about the plan.
The fact that it was too late to back out by the time Rick changed his mind is kinda the point. Merle knew he had to get Michonne out before Rick changed his mind, otherwise the opportunity would be lost. Whether Merle believed it would work or not is irrelevant. He wanted to believe handing over Michonne would save their butts. In that regard, he's as willfully blind as Andrea; refusing to believe what's in front of his face based on a thin thread of hope that things could be different.