hgwebdir: do not walk up the given path looking for a repository. It is there or it isn't.
#!/bin/sh
mkdir t
cd t
hg init
mkdir src
echo a > src/a.c
hg ci -Ama -d "10000000 0"
hg mv src source
hg ci -Ammove -d "1000000 0"
hg co -C 0
echo new > src/a.c
echo compiled > src/a.o
hg ci -mupdate -d "1000000 0"
hg st
hg merge
hg st