I re-factored all the gunk I wrote yesterday. Not only was it the wrong way around, it was doing things incorrectly (fun times with GDB :D), and the error messages shouldn't be returned manually but with a "ngx_log_error()" call followed by a "NGX_CONF_ERROR" return code from within the merge function. So, I grossly misunderstood the subtleties of the create and merge functions,
I don't know if there is a need for documentation on such aspects of nginx internals, I have reversed loads of documentation out of the source for myself for my current and next project. I am wondering if taking the time (perhaps on the existing wiki) to document some such aspects will be a good use of my time. Perhaps the most effective way of getting into system software might just be the hard way.
Anyhow thanks for the tips, and looking forward to getting more involved with the project.