Hi Sam
Thanks for the explanation. I understand the logic but still can't see the reason for the top statement in the window. Two long clips must have sufficient material for a short overlapping transition. I assume its hard wired.
I can see that resetting the in.out points might cause problems in many cases where the transition is removed particularly where the sound is unlinked. The post was just an observation that some might have found irritating (even if they noticed.) and I wondered why it did this and whether it was an oversight.
In this case there is absolutely no problem and in fact it is somewhat advantageous.?
For some reason the end of all the raw clips shot with this camera ( a Toshiba ) had the soundtracks truncated by around a second. making 1 second sound gaps when the clips were assembled on the timeline. Synchronization of the sound was otherwise perfect.....

Editing these out using Split/delete/close gap or the Clip preview IN/OUT markers would have been a nightmare with 100s of clips. However, automatically adding the overlapping crossfade transition to all the clips automatically removed this silent gap in the soundtrack.as well as smoothing out the action between the shots. After editing out the unwanted transitions (or even them all,) by using No transition, the clips were left in the same position so eliminating the sound gaps. Perfect!
Nat