The logic for --merged is in this repo. Please file an issue.
Note that one downside to --merged is that buildbot now no longer knows your source branch name in the buildbot.kitware.com grid (it is refs/test/release/6629/heads/1 where 6629 is the MR number and 1 means it is the second merge-test of the MR). CDash has the real name though.
I’ll note that gitlab-ci does not run merged tests by default for MR testing. We’d need Do: test to interact with gitlab-ci first (nb. we need that anyways for Backport testing too).