>>   if (foobar
>>       && quux % 2 == 0)
>>     {
>>       ...
>>     }<== point here!
>
> BTW, if I press C-g while the overlay is displayed, it flickers but
> doesn't disappear.

Hm, indeed, but it's the same for child-frame and also for "print in the
echo area".  C-g-ing will also run `post-command-hook' which removes the
frame/overlay or prints Quit, but after `show-paren-delay' the
`show-paren--idle-timer' will trigger `show-paren-function' again
resulting in another overlay/frame/message.

I'm not sure if that can be considered a bug but I can see that one
wants to be able to C-g away the overlay/child-frame, though.  I guess
`show-paren-function' should track the current position of point and not
show context info if that has already been shown previously?

Bye,
Tassilo