The A.I is wierd, sometimes their passive, other times they don't move off their line for anything. The rear ending thing is just stupid, there's no reason for it. In real racing drivers can ride 2 feet behind another car without rear ending them, can't be that hard to program these cars to not rear end you from 100ft behind you.
Just remember, the A.I. car have traction control, stability, and abs all on and trying to push them almost never works and you'll lose most any battle when contact is made.