I use overlay syntax for merge two depot's folders into one workspace folder.

When I overlaying folder 'Project_1/folder/' by 'Project_2/folder/...' like below and enable 'DELETE generated files' option - all files from original 'Project_1/folder/...' are removing and stays only '//depot/Project_2/folder/' files. It works with native client and another Perforce plugin.

 //depot/Project_1/...        //workspace/...
+//depot/Project_2/folder/... //workspace/folder/...