Are you trying to do overlays in Script or just by pressing a firm/hard key from your config in PEP3.
The reason I ask is because there are things in script such as defining callbacks for onOverlayShow/onOverlay hide that I last recall.
I played around with overlays but as they enter from both left and right of the screen, they really did not appeal to me. I don't even have PEP3 installed at this time as I simply don't use it.
The concept of the Overlay was put in place to support the TSW in-wall controller that did not have the Hard keys at the bottom of the display.
If you want to email me your latest config with instructions on how to reproduce what you see in the simulator and what's not working on the remote, I'll install PEP3 and have a look.