Mercy is typically a courtesy that you shouldn't expect to give/receive...if it happens to work out great, but it shouldn't be something to be relied upon.
The gheyest instance I've seen was at an old local field where there was this big hill to charge up against the defenders (Hamburger Hill sort of thing)...this one guy runs up waving his rifle all over saying "Mercy/Mercy/Mercy..." as fast as you could, then stated, "I got you all"...not even a single shot fired from him. The half dozen of us just looked at him like the freak he was and "took the hit" so there wouldn't be drama (but we did have a word with the host afterwards that the mercy rules were being abused).
Another absolutely hillarious instance of it was one small group of guys 2-3 storming a pair of bunkers...they ran up and "Mercy/Mercy/Mercy" one position, and it was decent in that the one last guy in that hut was done for....then they pointed towards the next position (halfway down the hill) and started shouting "Mercy/Mercy/Mercy" at the other two guys there. The two guys in that last position were like, "WTF?!?!...you'd be hard pressed to actually shoot me from that distance...". We were at the base of the hill laughing at the guys and shouting back, "Ummm....you've got to be a bit closer than that!".
I think mercy rules should be tossed out in general...too easy to abuse, to vauge in how they're interpreted and put into practice.
That said, I've mercied more than a couple of a guys over the years...just simple "dead to rights...don't want to hurt you at this 2 step range"...I've never had anyone decline it, debate it and because it's been so one sided I've never had anyone try to "outgun" me or whatever. I've also shot guys at near point blank...because we're shooting at each other and wondering if someone is going to take a mercy just isn't in the cards, but the other guy is opperating the same way so it's all good.