That actually looks exactly like it should. The order of the windows that vimdiff uses is (IIRC): ours, on-disk file, theirs.
"Seth House" [off-list ref] wrote:
David Aguilar <davvid <at> gmail.com> writes:
quoted
What happens if you remove this section?:
Same result. The conflict markers are still there:
http://i.imgur.com/d1vp1.png
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