Use smerge minor mode in emacs to resolve conflicts.
The condition-case is used to suppress errors with emacs versions before 21.
% should fail
abort: path contains illegal component: .hg/00changelog.i
adding a/a
% should fail
abort: path 'b/b' traverses symbolic link 'b'
% should succeed
% should still fail - maybe
abort: path 'b/b' traverses symbolic link 'b'