See URL. In summary, libsvn_delta/compose_delta.c:copy_source_ops() can recurse a large number of times (the linked report describes a recursion depth of nearly 2200 calls). If I understand DannyB correctly, the delta combiner is intrinsically O(N^2) when considering targe-copy instructions (i.e. as generated by vdelta), so this level of recursion may well be unavoidable (though some independent investigation of that might be nice). The problem here is that we typically have a limited function-call stack, so an overflow will terminate the process. DannyB suggested (and I agree) that we should convert copy_source_ops() from a recursive function to one that maintains a pool-allocated stack, so that a deep recursion can only use up heap memory, not C stack memory.
Original issue reported by malcolm