This is why objects "glow" if you put them on layer 3, they are fighting the darkness for priority. Typically when developing we reserve this layer for light effects, so they look much brighter in the darkness.
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Snicker...
https://www.youtube.com/watch?v=-leYc4oC83E
There is more to determining what objects get drawn over other objects, such as Z height. But that's not really something we can implement flexibly into the furniture system. It is used in many pieces of furniture to force priority, but because of the way this is handled it needs to be on a per-script-basis.
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Is that why chairs placed in certain areas of carpets (both at 0 layer) appear above, yet when placed in other areas they disappear underneath?
Thanks for the explanation either way.