You should not have several people keeping on-disk projects based on the same nsf. This will unavoidably lead to conflicts and lots and lots of pain.
What you want to do is to have each developer make his own local copies of the Notes databases. The local copies can then be associated with on-disk projects, which are kept under source control. The developers synchronize code between each other through the source control system, and code is pushed to the server by replacing design with that of the local copy.
For a detailed explanation and example (using Git instead of SVN, but the principle is the same) see How to incorporate version control (Git) in a large Lotus Notes project
Also take a look at this presentation by Per Henrik Lausten on using source control with Domino Designer. Be sure to read the discussion below the presentation as well, as it contains some useful clarifications.
Note that you may still get synchronization conflicts because of DXL metadata in the source files, such as the modified
and lastaccessed
tags. This is not something you should worry about. However it is annoying, as it clutters the change history/diff badly. If you were using Git instead of SVN, you could use a tool called DORA to filter these out, giving you cleaner diffs that show no useless metadata changes. I do not know of a similar tool for SVN, unfortunately.