hgapi is a pure-Python API to Mercurial, that uses the command-line interface instead of the internal Mercurial API. The rationale for this is twofold: the internal API is unstable, and it is GPL.
hgapi works for Mercurial < 1.9, and will instantly reflect any changes to the repository, unlike interfaces based on the CommandServer (http://mercurial.selenic.com/wiki/CommandServer). It also has a really permissive license (do whatever you want, don't blame me).
For example of code that uses this API, take a look at https://bitbucket.org/haard/autohook which now uses hgapi exclusively. Add any feature requests or bugs found to the issue tracker at Bitbucket.