The Overlay Mixer was a hardware feature. Your GPU had a dedicated "surface" in VRAM for video overlays. Karaoke lyrics are actually graphics (scrolling text over a static background). Walaoke would paint the lyrics onto this overlay surface. This was fast, used zero CPU, and looked sharp.
: Walaoke relies on external codecs. If a user installs a codec pack that overwrites the default DirectShow filters, the Overlay Mixer can lose its "verified" status within the app. walaoke problem with overlay mixer verified