One of the functions it does, I believe, is instead of printing things out to the chat window when you use hotkeys is to make it flash up on your screen sort of like a raid warning, but much larger and more visible. As far as I know it's not visible to GMs, so it's more safe to use the overlay than to use the printing to the chat window. I could very well be wrong here, and if I am, I really hope someone corrects me so that I, too, have a clear understanding of what the overlay does.What is the overlay even used for? Like, what does it do?
You also have problems that your FPS drop down when you start HB ?
Install this plugin and just activate it.