If you turn left/right any finite number of times going from point to point, it will be the same as if you traveled $x$ then turned once and traveled $y$ to get there. I hear that even an infinite number of turns will not suddenly shorten the distance to $\sqrt{x^2+y^2}$.
We have a similar situation in the staircase problem in which $\pi \ne 4$ because something happens [forgive me] at infinity. We no longer have size to the xy vectors. We have a set of points that coincide with the curve that is a circle.
Here, we have a set of points that are $not$ $close$ $to$, but $on$ the line that is the hypotenuse of a right triangle.
In the staircase problem, we still have an infinite number of vectors not pointing in the direction of the curve except at four points. How does the Manhattan distance differ from $\pi \ne4$ in the staircase problem above where we know the answer $\pi$ as a given?
I never learn why the staircase problem ends up as $3.14...$. Could we need new theorems to explain both of these? Or will they both forever be nothing more than paradoxes? Perhaps the staircase problem has no answer. Can someone verify that that it always results in $\pi=4$? If so, I can accept that the Manhattan distance never changes.

I think the considered paradoxes are of ancient Greek style and the key point here is to understand what is a distance and the length of a path.
The length of a curve is not its “abstract” property, but has a concrete definition via agreeing measurements. One of corollaries of this definition is the staircase paradox, which shows that curves which are arbitrary close as sets (with respect to Hausdorff distance) can have different lengths. But this is OK, because a curve is not only a set, but a set with a given walk along it. We see that the lenght of the limit of constant length curves can collapse, because in the limit case we lose a dimension for wiggling which increases a way and we are forced to go “straight” (that is, towards the tangent direction, infinitesimally).
Manhattan distance $d((0,0),(x,y))$ from $(0,0)$ to $(x,y)$ is defined to be $|x|+|y|$. If $P$ is any monotone path from $(0,0)$ to $(x,y)$ consisting of countably many axis-aligned segments (by the way, a monotone path has countably many (that is at most $\aleph_0$) such segments, because their projections on the respective axis has mutually disjoint interiors) then, according to a definition of the length of a curve in a metric space (see here), the length of $P$ with respect to the standard Euclidean distance on the plane equals the length of $P$ with respect to Manhattan distance. But this fails for a general case. Whereas the length of any monotone path with respect to Manhattan distance is the Manhattan distance between its endpoints (in this sense “the Manhattan distance never changes”), the Euclidean length of a hypotenuse of a triangle with axis-aligned legs of lengths $x$ and $y$ is $\sqrt{x^2+y^2}$.