The textoverlay element does not proxy the ALLOCATION query. It will make the query not arrive stop at this element when an  upstream element do this query.

In the case of playbin2 for example, decoders will query allocation downstream to use a common bufferpool, but as there is a textoverlay on the way, it will never be able to use the pool from the sink. In the end useless memcopy happens in the sink because of the fact that sinks usually wait for buffers that have been allocated by its own pool (it is the case for xvimagesink and ximagesink at least).