Unioning file systems: Architecture, features, and design choices

Also, a "standard" use case is to mount a root r/w ext2fs over an ISO9660 fs physically on CDROM/DVD, and so add devices in /dev where ISO9660 do not have the concept of devices.
I still vote for a real ext[23]fs either on a RAM disk or any other block device, full of soft link - but modify the meaning of soft-links with sticky attributes in the kernel - so that link attributes overwrite the attributes of the linked-to file; and to blank-out a file use either an attribute combination of the soft link, or a special and invalid path pointed by the soft link.