Backout ad09ce1d393c and replace ''' with """ to make some highlighting happy. I have tried Debian's default emacs and the current CVS version. Default emacs doesn't have highlighting enabled (and being emacs-illiterate I don't know how to enable it) and the CVS emacs' Python highlighting has no problems with ' characters here.

#!/bin/sh

hg init
echo 123 > a
hg add a
hg commit -m "first" -d "1000000 0" a
mkdir sub
echo 321 > sub/b
hg add sub/b
hg commit -m "second" -d "1000000 0" sub/b
cat sub/b
hg co 0
cat sub/b 2>/dev/null || echo "sub/b not present"
test -d sub || echo "sub not present"

true