Blessed are the merciful, for they shall obtain mercy. Matt. 5:7, R.S.V.
Nothing God does is arbitrary, for He is absolutely reasonable. If we think He is arbitrary, it is only because we have not yet come to an understanding of His ways. One does not teach a child not to hit by hitting him.
In showing mercy, was God being condescending? Is His the attitude of a benign potentate who has for some reason known only to himself decided to pardon the disobedient lackey? Does that fit into your picture of a merciful God? Though we know He loves us, we often think mercy implies a sort of sovereign choice. Those that feel their security lies in a God who has the biggest punch must then live with the possibility that He might obliterate them, too. The fact that He chooses not to is of little comfort. He could change His mind.
When we hold such ideas of mercy, how could we then offer to another any better? We can show mercy only to those who are weaker than ourselves. It brings us to a very basic question: What is mercy?
May I suggest that mercy means not letting another's actions ruin your mutual friendship. It allows that person the freedom to keep on relating to you even though he has compromised the friendship. It means that you value that individual more than you care about his momentarily adverse actions. It means that you are willing to "weather" his misbehavior as a deliberate and calculated move to heal your relationship with him. Mercy is in the service of restoring the friendship to all that it was meant to be.
God relates to us with a deliberateness born of intelligent understanding of our need to feel secure in His presence. He well knows how prone we are to hide from Him. So that we have no need to fear, He explains that He has chosen not to deal with us according to our actions.
The wonderful benefit of our choosing to relate in this way to others is that it works! The more we see how well-designed are God's plans concerning us, the more we appreciate Him. We know that we have not earned mercy by showing mercy. We rejoice that we have discovered the reasons why God deals with us the way He does.
As a matter of fact, it makes us all the more eager to be in relationship with Him.