I am using console as my tool for managing mercurial repositories. Wtih classic cmd or Console2 I type:
hg in
The PowerShell ISE indeed does not support console applications that require interactive input. The linked blog entry details options how to deal with that.
Since the PowerShell ISE is not a console, normal console applications cannot do everything they're used to, while of course PowerShell cmdlets can work just fine, since several things are dependent on the PowerShell host application (you get a graphical prompt with Read-Host, for example).
Console2 emulates a normal console by keeping the actual console around in a hidden window and polling it repeatedly for changes and, correspondingly, sending input to that window.