Found by openQA in a staging:
https://openqa.opensuse.org/tests/970506#step/transactional_update/9

For creating a chroot for a new snapshot, the upperdir of the current /etc is
part of the lowerdir chain for the chroot /etc.

This is apparently not supported by upstream overlayfs, as commit
146d62e5a5867fbf84490d82455718bfb10fe824 ("ovl: detect overlapping layers")
forbids those:

> On mount, the hash table trap entries are used to verify that overlay
> layers are not overlapping.  While at it, we also verify that overlay
> layers are not overlapping with directories "in-use" by other overlay
> instances as upperdir/workdir.