To your point, though, yes. They either need to unite or Rubio needs to drop out. I think he's shown to be less "electable" of the two.
I don't understand this line of thinking. Other than the deep south, that is all but done in the primary process, where does Cruz have a voting bloc? Rubio is right behind Cruz in the delegate count, and IMHO is far more likely to find voting blocs in the remaining states.
That Cruz didn't run away with the south, to me, is evidence that he has no path to nomination. That Rubio managed to pick up delegates and remain right behind Cruz even through the south, to me, is evidence that, of the two, Rubio has a more realistic path to victory.