[Tim Karlson] “A Bug? From Apple? Shocking!.”
Its not a bug. Merged Clips are not supported in multiclip.
The main manual incorrectly states that it will work, but the supplementary Read Me corrects this error..
Using Merged Clips Within Multiclips
The Final Cut Pro 5 User Manual (Volume II, page 248) incorrectly states that merged clips
can be used when creating multiclips. Merged clips cannot be used as multiclip angles.