Why is mercury a "fancy proton"?
It is a large, soft, Lewis acid. One can use protic acid and water to promote the same reaction, but the product distribution can sometimes be different. 
 In the oxymercuration reaction Hg can form a pi complex with alkenes or alkynes, and these "bridged" cations will not undergo rearrangments to the extent that those produced by protic acids might. 
 Bottom line - they're both essentially performing the same function in this reaction - activating the pi bond towards attack - but the oxymercuration is milder.