With convection, there is flow in the fluids. Think of hot solid object in cold air. The air molecules get heated by colliding with the surface and rebounding with higher energy. It doesn't follow that each individual molecule heats up the same temp of the solid in just one collision, and even if it did it would cool down when it collided with another colder air molecule. The *average* temperature of the air, very close to the surface, is less than the surface temperature of the solid.
That's what Newton's Law of Cooling says: across the interface, heat flux Q = h(T_1-T_0) where h is the heat transfer coefficient. H which depends on the surface finish, the flow configuration, and various nondimensional fluid parameters like Reynolds and Prandtl numbers.
This is different from conduction within a solid (or between two solids in contact) where the atoms only vibrate, they don't move around on a global scale. For solid conduction agree with you, the temperature gradient has to be finite and the temperature distribution has to be continuous. At least, that's true for the "classical" model of heat flow - at the atomic scale, considering the temperature (or KE) of individual particles is a different story.
For a solid that is an absolutely perfect insulator (K = 0, not 10^-23) then the diffusion/conduction equation just says dT/dt = 0 at every point. So there can (conceptually) be any temperature distribution you like in the solid, and it never changes. There's no reason why dT/dx has to be continuous because dT/dx doesn't come into the equation (or it's multiplied by 0, if you prefer). That's what I meant by saying the concept of "temperature in a perfect insulator" is not very well defined (or useful).
But of course there is no such thing as a perfect insulator.
The question of what happens in convection between a perfect insulator and a fluid is another "what is 0/0" type question I think. There can't be any finite amount of heat flux going into or out of the solid, because the heat can't go anywhere inside the solid. I think all you can really say is dT/dn is zero at the boundary of the fluid (where n is the normal vector) and the temperature in the fluid can be whatever it wants to be. There can be heat transfer along the surface, inside the fluid, so it doesn't mean the fluid temp has to be constant over the whole boundary.