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initproc is declared to return an int, but what returned values mean is not documented. Noddy_init in http://docs.python.org/3/extending/newtypes.html?highlight=initproc#adding-data-and-methods-to-the-basic-example can be seen to return 0 on success and -1 on error, but that's about it.
Also, when I wrote a function which return 1 on error, on every second invocation the exception would be ignored:
static int Reader_init(Reader *self, PyObject *args, PyObject *keywds)
{
 ...
 if (flags && path) {
 PyErr_SetString(PyExc_ValueError, "cannot use both flags and path");
 return 1;
 }
 ...
}
>>> obj(123, '/tmp')
>>> obj(123, '/tmp')
...
ValueError
>>> obj(123, '/tmp')
>>> obj(123, '/tmp')
...
ValueError
I'm not sure how to interpret this since I couldn't find the documentation for the expected value.