Diff is a great tool, and it's where we started on this whole thing. Unfortunately it's a little too complicated for most users, and there's no way to comment on individual edits unless you use source control and commit on every spelling change.
Not at this time. The syntax can get unreadable fairly quickly.
It works well with version control, and with our Sublime Text plugin you can Accept or Reject edits via keyboard shortcuts before moving to the next round of edititng.