If you paid cash, in virtually every case you'd pay exactly the same price because most merchants don't provide cash discounts. If your merchant does provide a cash discount, I would suggest taking advantage of it. But if they don't provide a cash discount, you're still paying that 2% margin anyway without receiving any benefit from it.
Likewise, except for small businesses whose owners don't actually price in the cost of their own time and labor, it's not entirely obvious to me that the cost of accepting credit card payments actually is any more expensive than the cost of handling cash, which is probably why cash discounts are rare. The main exception to that seems to be gas stations (which usually have a lower price for debit cards and not straight cash), except even in that case, I get an even bigger discount by using Costco's gas station, which doesn't have any such discount. You do address this point...
> > Once upon a time, it was beneficial for a merchant to accept credit cards, it lowered their costs for handling cash, which meant they saved money and the 2% cost for each transaction was reasonable. In a world where everyone is using credit cards for every purchase, that 2% is essentially a tax instead.
That makes no sense. If the cost of receiving credit card transactions is 2%, that doesn't imply that the cost of receiving any other kind of transaction is 0%. If there's no cash discount, the difference in cost to the consumer is zero anyway. But the difference in cost to the merchant isn't 2% either, because if they accepted a different form of payment, the difference in cost would be 2% minus the cost of accepting that different form of payment. (And if they didn't accept any form of payment at all, the cost would effectively be 100% because there would be no sales). In a world where credit card sales are ubiquitous, if anything, credit cards become a better deal for merchants because there's less economy of scale for cash-handling services.
All in all, I would even suspect there are instances where credit card rewards end up providing a net positive to a sufficiently devoted cardholder simply because most people are not going to expend the time and effort necessary to maximize their credit card rewards. It's just like Vegas in that sense--while it's true that "the house always wins", casinos will also comp you rooms and drinks, and there are documented instances in which you would expect to be better off playing video poker or blackjack for long enough to get a free room (assuming perfect play, which means memorizing a small decision tree). Why is this possible? Because the vast majority of people don't play perfect blackjack or video poker. Businesses plan for average-case expected customer behavior and not best-case (or worst-case from their perspective).