diff3: Fix merge mode.

[des]

Summary

This is mostly thj@'s work, with some tweaks and cleanup by me. There
are still some cases where our output differs from GNU diff3, but it's
much better than before and I'd rather commit what I have now than let
it continue to languish in a metaphorical drawer.

MFC after 3 weeks
Sponsored by: Klara, Inc.

[des]

because

[des]

nit

[thj]

Looks like an improvement to me, the big comment helps.

Can you bump diff3_version, I think it will help a lot in tracking bug reports.

I would like us to have more tests, but I know how difficult they are to put together.