Taking this a bit further (possibly changing your concept of the module too much), what about having this separation of one layer more fundamental to the whole design, not just as a “hidden” undo option.
So there would be two tapes, one where you can record directly and one where you can only “auto-overdub” the contents of the first. This way the mechanics of the undo would be more realistic and visible, basically you could only choose to erase the “direct tape”. This would also make it possible to include controls for trying out different volume, offset, speed etc of the overdub before folding it into the main tape.