you could just look at the source code for v2.81b which should answer all of your questions and can be found at http://mlipod.cvs.sourceforge.net/viewvc/mlipod/avs/
(it was meant to be in it's own repository but things got messed up and it ended up in the ml_ipod one for some reason). though the changes which constitute v2.81d can be found at http://nunzioweb.com/daz/temp/avs/vis_avs_changed.zip
(though is unlikely to affect what you're trying to do).
otherwise, you'd be best looking on MSDN and other code related sites for how to do overlays as AVS's implementation is most likely not ideal / fully compatible with current multi-monitor setups, etc.