it is quite easy to start a debug session.
1) Download and install the MSVS2010 SDK (http://www.microsoft.com/downloads/details.aspx?familyid=47305CF4-2BEA-43C0-91CD-1B853602DCC5&displaylang=en)
2) Clone VisualHG source code (https://hg01.codeplex.com/VisualHG)
3) Load the project and and set under debug options the devenv.exe as executable
You will also find a Readme.txt in the project folder.
This version there is single one timer thread, which is created at start up.
The timer object is located in HGStatus.cs and is started with the method StartDirectoryStatusChecker.
To find out who runs all this hg.exe calls see HG.InvokeCommand(...)
Use also the program 'ProcessExplorer'. It's freeware and it will give you a lot of command line infos of a running task. So you can see which command is exactely called so often to locate the problem.
Let me know if you need further infos and of course if you found out whats happend.
Good luck, Bernd