I'm currently try to remerge two versions of a source file that have diverged quite a long way. This is quite a painful process, and a tool like mgdiff makes it a lot easier to see diffs than just the normal command line diff.
Unfortunately, mgdiff has one essential missing feature; the ability to update the diff as you are editing the underlying files. So with a bit of help from Erik, a cooked up this patch which adds the feature. Hopefully this will hit the upstream package soon.