i use BI overlays no that no part of the video is permanently covered. you think the little timestamp wouldnt matter, but i cant tell you how many times i was watching live pd and they showed some clip from a bank or convenience store and the action was happening right under the timestamp. it does happen. ill let a cop come over and watch the raw, but i see no good reason to permanently stamp over the video. plan for the unexpected.
having a timestamp considered "alteration" is a valid concern and doesnt surprise me as dumb as our complicated ass laws are here in the US. the definition of "letter of the law" and not "spirit of the law." im sure you could also argue that changing the BVR file into an MP4, overlay or not, could be considered "altering" too. youve changed the entire file structure, technically.
and if the cops really do want the raw BVR then they can have it and itll have the metadata included if they wanna download a trial version of BI to view it in its UNaltered form.