To be perfectly honest, I do not see an answer to my question here.
You do explain some, but it seems that you end up indirectly stating that it is "semantics" whether the worlds overlap or not overlap. From what you say here it all depends on how you look at it, but that there is no "truth" of the matter. But that cannot be, either the worlds are overlapping or they are not. That is just the very fact of objective reality.
So while "both pictures are valid" in terms of math, not both can be the same. Metaphysically they are not the same and they got very different effects on episteomology. Also in terms of for instance quantum suicide. In overlap, it's hard to argue against some sort of Quantum Immortality, whilst in non-overlap death is just as in a classical one world theory.
What I am saying is that if one person says "all the worlds have always existed" and another says "the worlds spread out from one world," it's possible that both of them are being consistent, but then they are using two different definitions of "world." I am also saying that there is no basis that is "more real" than the others - only that some are more useful, and it's okay that people use different definitions as long as they're clear about it.
And yes, both pictures can describe the same thing. Have you worked wi...
http://www.scottaaronson.com/blog/?p=1103
Eliezer's gung-ho attitude about the realism of the Many Worlds Interpretation always rubbed me the wrong way, especially in the podcast between both him and Scott (around 8:43 in http://bloggingheads.tv/videos/2220). I've seen a similar sentiment expressed before about the MWI sequences. And I say that still believing it to be the most seemingly correct of the available interpretations.
I feel Scott's post does an excellent job grounding it as a possibly correct, and in-principle falsifiable interpretation.