Sid, it's not a "hardware problem with the overlay" but starting with R5xx most of the video processing hardware was removed from the overlay block and the work is now being done with shaders using TexturedVideo.

My understanding is that TvTime only supports a limited set of output formats and those don't include any of the formats we support as inputs to the driver, so either TvTime will have to add more output formats or we will need to add shader code to support more input formats.

We are continuing to wonk on video support in the driver so even if TvTime doesn't change I expect this will get addressed.