Stupid Question #1: What actually constitutes a conflict?

Is a conflict when two people have changed a file, or is it when two people have changed the same part of a file and VSTS needs assistance to resolve it? Every other (sane) version control system in the world interprets a conflict as the latter.

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Stupid Question #2: How is it "Auto Merge" when I have to tell VSTS to merge?

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Stupid Question #3: If VSTS could not-quite-auto-but-with-the-press-of-a-button merge, and it managed to resolve everything all by itself, why on earth does it pester me about non-existent conflicts all the time?!?!?

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Perhaps these questions are stupid, but I most respectfully submit that the answers are stupider.