Actually, intertia isn't the culprit - but it may disable rubber band bouncing as a side effect in certain apps when you are using the Magic Mouse.
The problem is applications or frameworks that ignore the user defined setting (NSUserDefaults) in a certain "domain" (NSGlobalDomain), ie, user preferences.
The setting for
defaults write -g NSScrollViewRubberbanding -int 0
Should really be
defaults write -g NSScrollViewRubberbanding -bool NO
or
defaults write -g NSScrollViewRubberbanding -bool false
but since 0 equates to NO and NO as a bool means false, it's actually OK.
In the above defaults command line, -g means "globally" or applying to the NSGlobalDomain which means that it affects all applications for the current user.
So, your problem (and mine) is that all applicaitons that use the WebKit display engine (Safari, iTunes, Chrome - for a few more releases http://www.theverge.com/2013/4/5/4186302/google-chrome-blink-coming-to-chrome-28 -in-10-weeks) are going to have rubberbanding hardcoded on since that is what WebKit does on the Mac.
Pretty crappy since we have paid 70 dollars per Magic Mouse and now, to turn it off, we would have to spend more money to try another scrolling device.
Also, the "tearing away from the edge of the containing window" of the Safari content is another disconcerting annoyance that we have been subjected to in Lion and Mountain Lion. The only solution I know of (other than to use Snow Leopard) is to completely disable gestures - but then I think if you are a leftie and you touch the middle scrolling region of the Magic Mouse, the tearing of the internal content, wobble and snapping back to the proper place within the window still happens. It is a common undesired annoying functionality that is visuallly disturbing and difficult to disable. Again, disturbing items like this make spending the 30 dollars to upgrade simply not worth it since there is no additional functionality provided in Lion or Mountain Lion that is worth tolerating these disturbances to the user experience.
Good luck. I think switching browsers, mice and possibly iTunes (check out my loss of 6000 podcasts bug) or reverting to a previous verision of the OS are your answers. And speaking of iTunes, issues like what we are trying to solve, plus this utter hideousness of the new iTunes interface and use of Helvetica Neue on the Mac, all add up to simply ruin what was once a wonderful user experience - and the reason why we used the Mac in the first place - because it had a GOOD user experience.
Good luck. If the past two years of releases of the Mac OS are any indicators, the people who will ruin the Mac experience is Apple itself.
I hope they see otherwise and retain the usability and pleasant user experience that Snow Leopard offered. 10.6.8 weas great - which is why I still use it now.