A prong collar keeps a dog from chocking himself on a flat collar or a choke collar when he pulls on the leash. The prongs should be rounded and do not hurt the dog. The pressure is similar to a mother dog nipping the puppy's neck skin.
I've been nipped by a dog, and I've used a prong collar on my dog and on myself. The two things are not remotely similar.
1. A dog's teeth are sharp; as you mentioned, prongs are rounded
2. A mother dog would not put her entire mouth around her pup's throat, in order to apply pressure evenly, as a prong collar does.
3. A nip is quick, in and out; a prong collar is constant pressure; even when it's not being tightened, the dog knows it is there. Depending on his experience with it, it may be irrelevant or a constant "threat".
4. Dogs can very precisely control how hard they bite; they may graze the skin and leave no mark, leave bruising, a small puncture wound, a tear or worse. Prong collars are much less discriminatory, and the "correction" can vary drastically depending on the participants and context.
5. Finally, and perhaps most important: humans are not dogs, and dogs know this. Using techniques and tools that attempt to mimic dog-to-dog behavior is at best, going to fall very short of the mark and at worst, be confusing for the dog.
Surely you would prefer a small amount of brief pressure instead a collapsed trachea.
I agree that flat collars, or any collar, can hurt a dog who is inclined to lunge against it. In my opinion, the answer is training - not using tools that scare/hurt the dog. In my particular case, my dog was worse off with a prong in terms of physical injury, than he was with the martingale I used simply because the prongs frightened and hurt him, making his reaction much worse. In any case, if one has a lunging dog, prongs aren't the only solution - harnesses are a safer alternative, and that is what I switched to.
Who cares if the dog doesn't like it for a few moments. Children don't like medicine but it saves lives.
Unike children, dogs do not understand why they are being hurt/made uncomfortable. They are similar to young kids in many ways, but they certainly lack the cognitive ability even a two-year old has. You can feed a two-year-old terrible medicine for two weeks straight, and love him/her up for the rest of the time, and the kid is not going to learn to be afraid of you. Conversely, you can slap a dog around once a day for two weeks straight, and even if you do love him up for the rest of the time, that dog is going to be confused and may exhibit fear/anxiety/appeasement around you. The dog is not going to understand that you only slap him once a day at 5 pm "for his own good"; he's only going to know that sometimes you hurt him.
There are certainly times when we may have to hurt/scare a dog in order to prevent injury or save its life: jerking it back onto the sidewalk if it happens to lunge at traffic, for instance. We also are subject to human failings, so we may yank a leash in frustration or anger. But using those kinds of methods as regular training techniques are completely unnecessary. There are kinder, gentler ways to train dogs that are ultimately more effective. The only downside to them is that they take longer, and people tend to want instant fixes.