There are a lot of Version Control systems available, including open-source ones such as Subversion, Git, and Mercurial. How well do they support the process of game-development? What are the issues using VCS, with regard to non-text files (binary files), large projects, etc? What are solutions to these problems, if any?

For organization of Answers, let's try on a per-package basis. Update each package/Answer with your results.

Also, please list some brief details in your answer, about whether your VCS is free or commercial, distributed versus centralized, etc.