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OK, I'll stick with git.

I'm surprised to see the emphasis on tracking lines of text, which ties in to the complexity of merge vs merge-the-other-way vs rebase. If we are committed to enhancing the change history, it seems wiser to go all in and store high-level, semantically-meaningful changes, like "move this code into an `if` block and add `else` block ...".

Consider the first example in the readme, "Left deletes the entire function [calculate]. Right adds a logging line in the middle". If you store the left operation as "delete function calculate<unique identifier>" and the right operation as "add line ... to function calculate", then it's obvious how to get the intended result (calculate is completely deleted), regardless of how you order these operations.

I personally think of version control's job not as collaborating on the actual files, but as collaborating on the canonical order of (high-level) operations on those files. This is what a branch is; merge/rebase/cherry-pick are ways of updating a branch's operation order, and you fix a conflict by adding new operations on top. (Though I argue rebase makes the most sense in this model: your end goal is to append to the main branch.)

Once you have high-level operations, you can start adding high-level conflict markers like "this operation changed the docs for function foo; flag a conflict on any new calls to foo". Note that you will need to remember some info about operations' original context (not just their eventual order in the main branch) to surface these conflicts.