In 1.6 it is not possible to replace a directory using rm/add/copy, only files
can be replaced. However merge can schedule a directory to be replacee, and it
works to some extent. Status shows something and the commit generally works.
Attempting further tree changes within the replaced directory won't always work.
Upgrading a 1.6 working copy to WCNG currently handles replaced files, but there
are no tests for replaced directories. I don't even know whether the upgrade
code works, but it might as a lot of the code doesn't care whether nodes are
files or directories.