Frx merges are a major pain. Which I why I recommend if your version control system allows locking, make sure you use it on the frx files to avoid merges. For example, Subversion supports locking to avoid issues with editing bitmaps and other binary files.
With that being said, my company and I have been using Subversion on a Visual Basic 6.0 CAD/CAM project for over five years and only ran into a problem with frx merging a handful of times.
In all cases, it was a simple matter to resolve. Mainly by one person making a backup of his form and resolving the problem by hand via cut and paste. If somebody is doing major work on one of the forms that has a lot of bitmaps, then we make sure we lock it and get that part of the project over as fast as possible.
P.S. Don't apologize for Visual Basic's FRX strangeness. Other packages have the same issue anytime two people edit the same bitmap, WAV or any other type of binary file that software will depend on.