Thanks for your post.
Merge replication isn't something that Data Compare is really designed for unfortunately, as it's a one way process. In addition, Data Compare works by scanning through the whole DB to establish the changes required, then building a syncscript. When working with Azure and running it regularly, this is likely to add up to quite a cost where data transfers are concerned.
Azure does have its own Data Sync tool now (see here
which may be worth looking into. I believe it adds triggers to the databases at each end and thus works more like traditional replication than a "scheduled sync".
Hope that helps!