help: it is 'file://localhost/', not 'file://local/'
The documentation has apparently always been wrong.
http://mercurial.selenic.com/bts/issue1089 $ hg init $ mkdir a $ echo a > a/b $ hg ci -Am m adding a/b $ hg rm a removing a/b $ hg ci -m m a $ mkdir a b $ echo a > a/b $ hg ci -Am m adding a/b $ hg rm a removing a/b $ cd bRelative delete: $ hg ci -m m ../a