The Three Visitors

At this point, God has spoken directly to Abraham many times. So why here, in Genesis 18, does he choose to come down in the form of not one, but three men? It is really strange. In fact, I find this whole chapter to be strange and hard to make out.
Who are these three visitors supposed to be? Three angels? That would make sense, except that Abraham treats one of them like God himself and not one of his messengers. Or is it God in human form with a couple of angels in tow. Or maybe it is the Holy Trinity - God, Jesus and the Holy Spirit.
And what's the deal with God taking human form now? I thought one of the big deals of Jesus' divinity was having God become flesh and thus gaining a better understanding of what humans go through. How then is that special if God has already done it? Maybe it was the length of time Jesus was flesh - going through the entire birth, growing up, dying cycle.
In his "Guide to the Bible", Isaac Asimov notes that scholars today believe some of the source material used for the old Testament came from a polytheistic culture and that the Biblical authors tried to scrub those references out to mesh with their mono-theistic belief system. But they apparently missed some referneces or chose not to change it for other reasons.

Nevertheless, Abraham immediately recognizes that one of the men is God and insists on washing his feet and getting him something to eat. And then God makes yet another one of his pronouncements about Sarah giving Abraham an heir. Hearing this the 90-year old Sarah stifles a laugh, but not well enough to keep God from hearing it at which point God seems to take offense.
Why did Sarah laugh, God demands to know from Abraham. Sarah objects and says she did not laugh, to which God replys "Oh yes you did!"
Then Sarah says "No, I did not." And God says, "Oh, yes you did."
And Sarah says "Did not, Did not, Did not!!!" And God says "Did too, Did too, Did too!!!"
OK, so it didn't really go on like that, but it just as well could have. What was the point of that exchange?

The next part of the story is even more bizarre in my opinion. Who would have ever thought that God would need to be taught or shown how to be merciful by man? Yet, here we have Abraham pleading for God not to destroy the entire communities of Sodom and Gomorrah if he can find a certain number of "righteous" people. What if he finds 50 righteous people? Or 40? Or 30? The exchange goes on like this, back and forth, to the point where it's almost like a Monty Python sketch. But then Abraham stops at 10 righteous people. Why there? 10 is OK, but nine is not enough? That seems arbitrary.
I've just never thought of myself as being more merciful than God. It is one of the reasons why I don't believe in Hell, at least, not in the sense of eternal damnation and torment. Since I could not condemn anyone so harshly, I don't see how God could be less merciful.
But God is not very merciful in the Old Testament, and that is one of the reasons why I have such a problem with it. It's because Christ's mercy is such an integral part of my faith, that I am repelled at the idea of God not reflecting that mercy the same way.