I admit I have a pretty simple understanding of what it means to be merciful. To be merciful is to give attention to another person without judgment, if necessary forgiving the other person, and helping to meet his needs as if they are my own.
The model is Christ, who shows mercy to all through his sacrificial redemption of the world on the cross. He also says, "Blessed are the merciful, for they shall obtain mercy." This follows a progression of spiritual ascension that begins with poverty of spirit, a quality that moves one to mourn and weep when faced with sin and its consequences, death and its multitudinous manifestations, a fire of grief that promotes meekness -- which is primarily the loss of self and self-interest in order to be filled with divine love, which originates in a relationship with God that reconnects the human person with the earth, the spirit with the world of matter; moreover, it is a meekness that hungers and thirsts for righteousness, and is satisfied through a life that is permeated with the divine fire of love and expressed in works of mercy.
The blessing upon the merciful seems to flow directly from the previous beatitude in that the merciful are those who have hungered and thirsted for righteousness, and have been satisfied; in other words, they are made righteous through cooperation with the grace of God revealed in Jesus Christ, who shows us what it means to be merciful through his own suffering and crucifixion. As their own lives are justified, they begin to manifest justice in the world, and this is chiefly shown through an expression of mercy. Mercy is love in action.
The merciful do not follow a necessarily easy path. The cross that Jesus carried to his death, whereby he trampled down death by death, was a hard road for Him, so much so that he prayed fervently in the garden of Gethsemane, and sweat drops of blood. Showing mercy to others, like being poor, or mourning, or being meek, or like hunger and thirst, is a quality of soul that necessitates death, self-denial, perhaps even significant personal loss. Similarly, Jesus teaches us to pray, 'forgive us our debts, even as we forgive our debtors."
We pay attention to that which we love, and if we love others with the love of God, we will see them not only as being of value because they are made in His image, but as worthy of love because of the person who is there, even if effaced by many sins and distortions of personality. The merciful pay attention to whoever is before them without judging them because of their social status or appearance. St. James has strong words for those who give preference for the rich, while diminishing the poor. And Jesus, speaking of the various judgments people made of him, said that man judges according to appearance, but God judges according to the heart. The merciful give attention to others without condemnation or blame for what they have done or what they do.
Being merciful isn't contingent upon anything. We cannot say, 'you did this to yourself; you live in poverty because you are lazy; or, you are sick because you do not eat healthy foods; or, you have cancer because you smoke cigarettes; or you are addicted because you hate your own body; therefore, because of these things, I am under no obligation to help you." The merciful do not make those kinds of judgments; those are for God alone to make. Our job is to be merciful to all, and thereby obtain mercy.
St. Isaac of Syria writes,
"You have not been appointed to decree vengeance upon men's deeds and works, but rather to ask for mercy for the world, to keep vigil for salvation of all, and to partake in every man's suffering, both the just and sinner's. Instead of an avenger, be a deliverer. Instead of a faultfinder, be a soother. Instead of a betrayer, be a martyr. Instead of a chider, be a defender. Beseech God in behalf of sinners that they receive mercy, and pray to Him for the righteous that they be preserved. Conquer evil men by your gentle kindness, and make zealous men wonder at your goodness. Put the lover of justice to shame by your compassion. Remember that the sins of all men go before them to the judgment seat."
Being merciful may or may not involve big things. It more likely involves being merciful where I am at right now. In a marriage that means continuous forgiveness, both seeking it from the other and granting it. In a family, it means all the things that constitute the sacrifices of family life -- giving up personal time or ambitions or luxuries for those whom we love -- but it's more likely more difficult on a simpler level ... for instance, being merciful when your loved one repeats the same annoying habit for seemingly the thousandth time. Small annoyances can blow up fast. Learning to transcend or deal with even really minor annoyances is a beginning, a spark, a movement toward being among the merciful.
Sometimes, of course, such annoyances may be symptoms of larger issues, an elephant in the room, and so learning to love and be merciful in the minor things may help to work one's way up the chain to resolving more complex problems. I don't think any of us are ever going to "overcome" the difficulties of living with other people, both major and minor, no matter what that may entail for each one of us specifically, but we can learn to be merciful in whatever situation we live. The fact that we may always be faced with strife, misunderstandings and miscommunication, an uncaught harsh word, bad moods and annoyances just means we have plenty of opportunity set before us to practice mercy, and to obtain mercy according to the promise of Christ.