Just curious if there is any news on this front?

I believe there's more to it than just the bundle2 setting that causes it to not work. It still breaks for me even with devel.legacy.exchange=bundle1:

So reading through all of this, am I understanding correctly that Phabricator and Mercurial > 3.4 aren't compatible with each other? I've spent the past couple days attempting to push an existing repository with a few thousand changesets into a Phabricator hosted instance to no avail (using mercurial 4.0.1 for both the client and server).