Sometimes (often!) you want clean history in the upstream but also patches separated by bugs they fix, features they add -- issue/ticket numbers, whatever. And you may want regression tests to come before bug fixes, that way you can see the regression test failing, then the test passing after applying the bug fix. Different upstreams are likely to have different rules.
So squash-and-merge is a bad one-size-fits-all. Rebase is a much much better approach: you keep the history as submitted and you lose the useless merge commit. There's no "unnecessary local information" if the submitter did the work of cleaning up their history before submitting. That means doing interactive rebases locally to squash/fixup/edit(and-possibly-split)/reword/drop/reorder their commits -- this is something every developer should know how to do.
So squash-and-merge is a bad one-size-fits-all. Rebase is a much much better approach: you keep the history as submitted and you lose the useless merge commit. There's no "unnecessary local information" if the submitter did the work of cleaning up their history before submitting. That means doing interactive rebases locally to squash/fixup/edit(and-possibly-split)/reword/drop/reorder their commits -- this is something every developer should know how to do.