Having cleared up the confusion over what info becomes invalid, the overall answer seems clear to me:
A tree conflict applies to a path. Think first of the simpler case: a file. If I copy the (local, working) file to another name or to another directory, the tree conflict (info) should not be copied; just the current working version of the file should be copied. If I delete the file, strictly speaking the tree conflict (info) should remain, although, as a high-level convenience, we might want to automatically resolve the conflict at the same time. If I move the file, the tree conflict (info) should stay where it was. Now for a directory, the same applies, if I'm operating directly on it. Finally, if I attempt to copy/delete/move a parent directory of the tree conflict victim, then what? Gotta run now; will come back and think about this case later. - Julian