It isn't just an issue of coming up with a good representation of the data. Actually doing something with the graph, like answering the query "is this string a

It isn't just an issue of coming up with a good representation of the data. Actually doing something with the graph, like answering the query "is this string a path through the graph?", is hard to do at the necessary scale (you might make a billion such queries after sequencing a genome). The classic string indexing approaches (suffix arrays, fm-index, etc) don't easily generalize to graphs and this is a very active research topic.