I tend to agree that anyone who denies the tendency to rationalize is either in denial or has a different definition for the word "rationalize". In fact I would argue that rationalization is the default for human beings, and that anything else requires either focused effort or serious mental re-programming (which is still probably only partially effective).

I absolutely relate. I totally would have said that a week ago. Evidence has smashed my belief's face quite solidly in the nose, though.

One possible way to try to elicit an understanding for any given individual's capacity for rationalization is to ask them about the last time they did something they knew was a bad idea (perhaps a comrpomise they felt uncomfortable making, or an indulgence they knew they were going to regret), and then to ask them what excuses went through their brains to justify it. If someone still denies ever having had such an experience then they are beyond redemption.

That's a good idea, and we did it several times. They sincerely do deny having such experience, but not in a knee-jerk way. It's more like a, "Huh. Hmm. Um... Well, I honestly can't think of something quite like that, but maybe X is similar?" And "X" in this case is something like, "I knew eating a cookie wasn't good for me, but I felt like it and so I did it anyway." It's like the need for justification is just missing, at least in their self-reports.