Just a note about remesh all; it's basically serves two functions: first it can create a new mesh over the object that has a 'unified skin' surface more fit for sculpting (even quads, etc), which is what you're getting with that blob. If you follow it up with ReProject All, it will go from being a blob to having the right shape and all that detail. The second use is very similar to the first, except you can have subtools boolean each other. Both create new tools, leaving the old ones untouched so don't worry about it being irreversible (play around with it sometime, it can open a few doors).
As for merging, hide what you don't want to merge and use 'Merge Visible' (it's right under Merge Down)
It should have an effect, just not in the area you'd expect to see it. It merges the result into a brand new tool, instead of collapsing your subtools together like merge down does. So you'd have to append the new tool as another subtool, or clear the canvas and draw the new tool onto it.
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As for merging, hide what you don't want to merge and use 'Merge Visible' (it's right under Merge Down)