2) Full decentralization is in my view inevitable. The second a decentralized exchange goes online, it will become the gold standard - no need to 'trust' the issuer, and users retain full control over their funds.
Decentralized solutions r unable to compete with centralized ones coz blockchain-based HFT is impossible.
Decentralized != blockchain based.
You're correct, blockchain-based solutions are unlikely to be able to support HFT, even in the medium term. However, OT is decentralized and can handle HFT just fine (amongst other things). The ideal setup would be decentralized exchanges operating their 'backbones' on a blockchain and frontends (including HFT) over OT.