I am trying not to be rude, but it is very... surprising to me that a piece of paid software has such a huge issue, and there is no easier fix than the complicated procedure of removing duplicates and re-inserting them. For a substantial manuscript, this is hours of work to get right, and the stakes are high. Perhaps an effective solution would be to add some feature to merge references / citation keys, e.g. from the "View all references" page.
I unfortunately started this current project using Paperpile, and so it is very difficult to switch away now. But I can't imagine using it again for future projects, due to the number of headaches this issue has caused. Judging based on the comments above, I am not the only one with this problem. Asking your (paying) users to go through an /incredibly/ tedious process to correct this error does not seem like a fair response.