I can't speak for the OP, but have you seen how the built-in TFS conflict resolution process works?
VS2012 puts all the windows in the main document editing area. It starts with a list of conflicts that need resolving, each of which you can choose to open in your configured merge tool. I use Beyond Compare at the moment (which obviously opens externally), but the built-in diff tool opens in another tab in the editor area. The accept/reject merge decision comes up as a modal dialog when you close the merge editor window/tab.
I can't speak for the OP, but have you seen how the built-in TFS conflict resolution process works?
VS2012 puts all the windows in the main document editing area. It starts with a list of conflicts that need resolving, each of which you can choose to open in your configured merge tool. I use Beyond Compare at the moment (which obviously opens externally), but the built-in diff tool opens in another tab in the editor area. The accept/reject merge decision comes up as a modal dialog when you close the merge editor window/tab.