I agree that for in-town trips the only thing that reduces the convenience of driving is when you can't drive fast and park directly at your destination for free. But these things (traffic, parking scarcity, etc) are really common, and are often the direct result of the fact that you are trying to go somewhere interesting. They are rarely artificial costs that could be removed.

I do think anecdotes are effective here, so: from my old SF apartment I could bike or ride Muni to the office. I generally chose to bike, but both options were more convenient than driving. The speed of driving and biking were both limited mostly by traffic and traffic lights, so biking was just as fast as driving. Both the traffic and the traffic lights are necessary because other people also want to live and work in a similar place as I do. But since my office was downtown in an urban, popular area where land value is high enough that parking is not a good use of land, if I drove I would have had to park a few blocks away (for a high price) and walk. Since bike parking is so much more space efficient than car parking, I could easily park my bike in my office. Taking the train was faster than either option; if it rained I would simply take the train.

I think you are not correct that a car is a strictly better option for all tasks. I think the convenience of not having to deal with all the things that make driving difficult is extremely valuable, and I think the things that make driving difficult are unavoidable because driving scales extremely poorly.