On Windows look for mercurial.ini in $USERPROFILE, too, if available as os.path.expanduser('~') does not always yield a useful directory. Based on a patch from Edouard Gomez <ed.gomez@free.fr>

#!/bin/sh

hg init
python -c 'print "confuse str.splitlines\nembedded\rnewline"' > a
hg ci -Ama -d '1 0'
echo clean diff >> a
hg ci -mb -d '2 0'
hg diff -r0 -r1