I usually say Merry Christmas. There's nothing wrong with having a happy Christmas but just being happy really isn't in the Christmas spirit, is it! At Christmas it is nice to be happy. But you can be happy any day - the day the sun shines, the day you get good news. At Christmas I want to be jolly and merry. It suggests parties and sherry and laughter. Merry sounds much more FUN than just happy. I get merry at any party - it doesn't have to be Christmas!

Warning: from Italy I believe that: a. /merry/ to have a meaning of /joyful conviviality/ b. /happyness/ does not necessarely imply sharing feelings with others, although probably /happy/ has an higher degree than /merry/. Therefore, and for the traditions of Christianity I see /merry/ more apt to Christmas than /happy/. (something slightly different would apply to /Easter/ in my view).

We say both "Merry Christmas" and "Happy Christmas"; they are interchangeable. However, almost everybody writes "Merry Christmas and a Happy New Year". i.e. they tend not to write "Happy Christmas and a Happy New Year" because it repeats "Happy' which doesn't read as well.

Oh, and the New Year. Well, it would be nice to be happy all year... but being merry all year would be absolutely exhausting!

Well, we do say "Happy Christmas," although "Merry Christmas" is much more common. It's just tradition. There's no logical reason. There are just pairs of words that customarily go together. I believe they are called "collocations." One of the most beloved of all Christmas traditions in the U.S., Clement Moore's poem "A Visit from St. Nicholas" (often called by its first line, "'Twas the Night before Christmas") ends with "But I heard him exclaim, ere he drove out of sight— 'Happy Christmas to all, and to all a good night!'" On the other hand, in Charles Dickens' "A Christmas Carol," "Merry Christmas" is used throughout.