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Those two Overwrite settings have been at those values in my GrassControl.config.txt since before my first post and haven't changed. The corresponding values in Skyrim.ini and SkyrimPrefs.ini also match those values and also haven't changed. I'll bring the issue up with Sheson et. al. at some future point. Again, thank you for all of your advice and help.

Yes, evetyone is correct: I first started skyrim through its launcher, it asked me to sign in to bethesda account, I didn`t had one, so I get out, made the account, forgot to go back into the game, but started installing SkyrimSE v2.0.0 and when launching the game through MO, logged into bethesda into the main menu all downloads started but went into overwrite folder. Maybe the guide should promt more clearer that ALL CC contend should be downloaded right in the begining and maybe list the necesary content at the begining of STEP 3 (where CC plugins entry is, but with detailed entries for every mod) Thank you all for help!

The first suggestion was the issue; I mistyped the path to the xLODGen Output folder in the XLODGen command parameters config. Fixing that path allowed me to create textures in my xLODGen Output folder and then successfully overwrite using ACMOS. Thank you! Relatedly, in the System Setup Guide I noticed there is a typo in the xLODGen setup description that should be fixed: "3. Create a folder for the application output: ..\Games\Modding\Tools\xLODGen\xLODGen_Oputput" Anyway, thanks again for your help!