I was trying out the VS 2005 Web Deployment Projects addin on one of my websites.  Wanted to merge all to one named DLL.  I was getting an error "Aspnet_merge Exited with Code 1" with very little other detail.  After some digging found the solution (at least in my case).  It appears that I had a duplicate class name in my project (actually had two of them).  Once those were cleaned up, build succeeded without problems.