Hi Nat,
As mentioned, the latest BETA 3.0 version is what's being used here. There is no gray box with the word "overlay" and the tab labels read: Sequences, Video Files, Audio Files, Images, not Media list, Effects and Transitions.
Perhaps this is where our communication is breaking down. As I noted, the attachment in the earlier message from the moderator is not downloadable or viewable.
I guess someone who is using 3.0 will have to update us on where "overlay" lies.
Click HERE to see the screen that I see.