It's usually called 'super pixel', there's no reason to ever use it really. Bilinear is pretty fast, VNG is a little better quality and AMaZE is about the best there is. There are also some proprietary algorithms (ACR).
I use a program called pixinsight that has various debayering methods you can choose from, including those mentioned above as well as a mode where each pixel is simply made the color of the sensel (basically you're seeing exactly what the sensor saw). That's very useful for comparison and analysis of raw data (but not for practical image processing). I guess technically that would be the most 'pure' way to display the data.