True push not supported

I tried some simple tests with bzr-svn. I created a local svn repo using the svn file protocol. I then branched this repo with bzr. Added a file and then pushed to the repo. I then checked out the repo with svn added another file and committed. In the bzr branch I then modified the first file committed and then tried to push. It correctly told me that the branches had diverged and that I needed to merge first. So I merged from the svn repository but the I got a conflict in the first file (which was not even modified in the repo). Doing a bzr status showed some strange things:

bzr status
added:
 hello.txt
 test.txt
renamed:
 hello.txt => hello.txt.THIS
unknown:
 hello.txt.BASE
conflicts:
 Contents conflict in hello.txt
pending merges:
 ubuntu 2007-01-19 Add test.txt
   ubuntu 2007-01-19 Added hello.txt

The exact sequence of commands I executed were:

cd /tmp
svnadmin create svnrepo

bzr branch file:///tmp/svnrepo test-bzr
cd test-bzr/
echo hello > hello.txt
bzr add hello.txt
bzr ci -m "Added hello.txt"
bzr push --remember file:///tmp/svnrepob

cd ..
svn co file:///tmp/svnrepo test-svn
cd test-svn
echo test > test.txt
svn add test.txt
svn ci -m "Add test.txt"

cd ../test-bzr/
echo "Hello from bzr" >> hello.txt
bzr ci -m "Update hello.txt in bzr"
bzr push <--- Correct error that I need to merge first. Things go pear shaped from this point on though...
bzr merge bzr status <--- Weird status after merge as hello.txt was not changed at all in subversion working copy. There should be no conflicts