This breaks the checkfiles logic. I have tried to fix it without much success. It seems to partially work, but not fully. The fixwhitespace --diff just exits with an exception The commit (fixup_hook with --diff) works ok, but the file remains modified (without --diff) after being commited.
The change was introduced in hg in cset c343557a8442 (Aug 20 2014), with the message "enable diff.tab markup for the color extension".
I'm marking it as major as it basically disables the tab checking, which is a central feature.