This is always a pain no matter what source control system I have used (source safe, cvs, clearcase...) the binary .frx files always cause a problem when merging visual basic forms.
I know...I know...why are you using Visual Basic...because there are lots of legacy apps still written using it and although I hate to admit it I actually like using it (ducks tomatoes)
You need to just bite the bullet and include them in version control system. Unfortunately, they do contain information that isn't available anywhere else in the source. (The bitmaps added to ImageList controls, for example.) If you lose those files, you can't rebuild the application correctly.
Frx merges are a major pain. Which I why I recommend if your version control system allows locking make sure you use it on the frx files to avoid merges. For example Subversion support locking to avoid issues with editing bitmaps and other binary files.
With that being said my company and I been using Subversion on a VB6 CAD/CAM project for over 5 years and only ran into a problem with frx merging a handful of time. In all the the case it was simple of matter to resolve. Mainly by one person making a backup of his form and resolve the problem by hand via cut and paste. If somebody doing major work on one of the forms that has a lot of bitmaps then we make sure we lock it and get that part of the project over as fast as possible.
P.S. Don't apologize for VB's FRX strangeness other packages have the same issue anytime two people edit the same bitmap, wav or any other type of binary file that a software will depend on.