I can't get the vines overlay to work. I'm using version 3.3.8 from Curse. I'm trying to apply the vines to a carpenters barrier by sneak-right-clicking and have tried both barriers with and without a block in them. I have also tried ordinary carpenters blocks with and without texture block in them. Am I doing something wrong?

No, it looks like functionality with block overlays might be broken. I'm looking into it.