We work with a lot of binary files (fla/swf/img), so it occasionally happens that there's a conflict on a merge. Command line Mercurial lets you choose which file to keep, the local or the remote.
In MagHg, I do get notified after the merge that there was a conflict that it wasn't able to resolve. However, it already went ahead and made the choice for me, keeping either one of the files. This potentially overwrites the wrong file and I have to pull the file from a backup.
As an enhancement in a future update, it would be great to have MagHg prompt for the local/remote file selection, so the right file could be kept.