like this snippet from a module I have for disko:

{ lib, config, inputs, ... }:
let
  cfg = config.flake.disks;
in {
  options.flake.disks = {
    device = lib.mkOption {
      type = lib.types.str;
      default = "";
    };
  };

  config = lib.mkIf cfg.device != "" {
    imports = [
      inputs.disko.nixosModules.disko
    ];

    disko.devices.disk.root = {
      device = cfg.device;
      type = "disk";
      content = {

interestingly, something like the following in nix/withOverlays/default.nix works:

final: prev: (prev.lib.composeManyExtensions [
  prev.inputs.nixgl.overlays.default
  prev.inputs.emacs-overlay.overlays.package
  prev.inputs.self.overlays.overrides
  prev.inputs.self.overlays.lix
]) final prev

So computing the module arguments is triggering evaluation of withOverlays... hmm

Does it make sense that this is supported?: (How does Flakelight know whether it is an overlay or a function to setup multiple overlays, like in my example ?)

withOverlays = overlay; 

Shouldn't it only support?:

withOverlays = [overlay, ...];