Thank ya kindly for your followup Ashely and BP.
@Ashley - you said, "simply forgetting to update before you start working then trying to commit at the end will cause things you have not changed to conflict with things other people have changed, because your copy is out of date (and it doesn't know if your intent is to roll it back). So accidents or misuse of source control systems cause that type of error."
So even with SVN, you never work in parallel with others with Construct 2? You always let them finish, commit their changes, you check them out, you commit, and then they can go again? If so, this was my chief misunderstanding, and it may warrant more clarification in the SVN tutorial. I consider the main benefit of SCM to be intelligent merging, so we can all sit down and work together at the same time, and then merge our work, without having to fix a bunch of conflicts.
I work with XML files all the time for iOS development, and git will merge multiple concurrent updates to the same file with ease. I guess thats why I'm confused its causing problems in this case.
Just picking nits of course, Construct 2 is awesome and I'm glad I'm alive to witness its coming global domination.