The merge() function (which we've used for years in GRID, ArcView, and ArcGIS Desktop) simply doesn't exist in ArcPy map algebra.
I came up with a Python map algebra implementation (with some nice refinements from a friend on the Spatial Analyst dev team). Give it a spin and let me know if you are successful with it!
import arcpy
from arcpy.sa import *
arcpy.CheckOutExtension("spatial")
def Merge(raster_list):
"""Merge a list of rasters. The first non-NoData value found (cell by cell) is kept.
Merge([raster1, raster2, raster3, ...])
This is another implementation of ArcGIS 9x Map Algebra merge() function"""
if type(raster_list) == str:
raster_list = raster_list.split(";")
if len(raster_list) < 2:
raise Exception("More than one raster required")
# create list of raster objects to merge
rlist = [Raster(arcpy.Describe(ras).catalogPath) for ras in raster_list]
merge_ras = rlist[0]
for ras in rlist[1:]:
merge_ras = Con(IsNull(merge_ras), ras, merge_ras)
return merge_ras
