Challenge 1: Getting the Webcam to Appear as a Picture-in-Picture Overlay — Solution Walkthrough

What determines this:

Per this chapter's own material, the order Sources are stacked in
within a Scene determines what covers what — the same layering
principle used in Raster Editing Fundamentals. For the webcam to
appear as a small overlay on top of the screen recording rather than
being hidden behind it, the webcam's own Video Capture Device Source
needs to be positioned higher in the Source list than the Display
Capture Source.

Why the reverse ordering would hide the webcam:

If the Display Capture Source were placed above the webcam Source in
the stack, the full-screen capture would visually cover the webcam
entirely, since whatever sits higher in the stack covers whatever is
beneath it — exactly the same rule this chapter draws directly from
layer stacking in raster image editing.

The practical fix:

In OBS's own Sources list, drag the webcam Source above the Display
Capture Source (or use the equivalent reordering controls), then
resize and reposition the webcam Source into a corner of the canvas
to achieve the picture-in-picture look.

WHY THIS WORKS AS AN ANSWER
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This exercise is a direct, practical application of this chapter's own
Source-stacking-order material to a concrete, realistic OBS setup
task.