Technically,
instead of is a compound preposition. Only a noun(or a noun equivalent such as a pronoun, noun clause) is allowed to follow a preposition or a compound preposition(such as despite of or because of).
Rather than, on the other hand is a Subordinating Conjunction. You may have a noun, adjective, or preposition phrase as well. And it depends on parallelism; i.e what you have on the right hand side of rather than.
Here are the examples:
I always picture myself driving a bugatti chiron
instead of a mercedes maybach.--> Correct
I always picture myself driving a bugatti chiron
rather thana mercedes maybach.--> Correct
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I wish this transmission were manual,
rather than automatic.--> Correct.
I wish this transmission were manual,
instead of automatic.--> Incorrect.
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To identify the Main Point, it's best to read the RC passages quickly
rather than with precise attention to the details.--> Correct.
To identify the Main Point, it's best to read the RC passages quickly
instead of with precise attention to the details.--> Incorrect.