alt Hacker NewsI think you may be focusing on this with a lens that isn't incorrect—and is in fact very worldly—but which fails to account for individuals' behavior on their own terms.
You define your own notion of collectivism and make claims about how it is necessarily in conflict with other principles, when in reality millennials aren't a monolith, collectivism isn't a monolith, and individualism isn't a monolith. Cultures and subcultures renegotiate the meaning of every -ism they import, and they practice these -isms only as bundles of other, historically correlated -isms.
When the American youth say they want collectivism, they are not saying they want a return to authentic rice farming culture. Most of the time, they are mourning the systematic loss of third places, they are mourning the obliteration of social safety nets, they are mourning the lack of public projects, they are mourning the death of individually influenceable local politics. At the same time, they do not want rigid social roles ordained from above (because "above" is powerful and corrupt). They also do not want a parochial existence taking care of grandma (because the elderly are in greater number and need than ever, and our infrastructure and way of life is ill suited to efficiently meeting these needs). None of this is contradictory cosplay. It is simply a fusion of individualism and collectivism that is unlike that which has existed before, as a result of cultural factors that are themselves unlike that which has existed before.
I agree that terms don't have fixed meaning, but the terms still have certain essential characteristics. I'd argue that what millenials want is more accurately described as a form of hyper-individualism. It seems superficially collectivist because they want more government spending, and the GOP convinced everyone that anytime the government pays for something that's communism. But the spending is actually in service of individualism. It's directed to freeing individuals from the social obligations they would have in a more collectivist society. E.g., they want social security to free them from the obligation of caring for their parents. Then they want free child care to free them from the reciprocal obligations they would incur if they relied on their parents for childcare. They want payments for kids, so they can be freed from the obligations of marriage. They want free education, but they want to choose their course of study, not receive training in whatever jobs the government determines need to be filled in the economy.
And the reason I'm quibbling about whether you label this "individualist" or "collectivist" is that it helps explain what happens as these people get older. Why did the seeming collectivism of the baby boomers in the 1960s give rise to a period of extreme libertarian individualism in the 1980s? I think that makes more sense when you realize that what happened in the 1960s was not collectivist, but instead a surge of individualism coupled with a rejection of obligations imposed by traditional society. Viewed that way, it makes total sense how the baby boomers went on to create an economy that was characterized by the rejection of social obligation.