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In these situations, pink, the boat that tacks windward, will be always clear ahead at least for one second. So, if the lateral separation is less than two boats, rule 17 applies.
That is my understanding of when rule 17 applies. If the overlap occurs before Pink passes through head to wind, then rule 17 does not apply and Yellow is not limited by rule 17. If the overlap occurs after Pink passes through head to wind, then rule 17 applies and Yellow is limited to not sailing above her proper course by rule 17.
The net result of the rule change is that rule 17 will apply more often than in the past. This will make the slam dunk easier to perform as Pink does not have to worry as much about being luffed.
@Michael - Yes it is true that an overlap cannot actually exist while the boats are on opposite tacks. What I was trying (and failing) to describe was an 'overlap' occurring at this point in time. Rule 17 would not be a limitation for Blue and she could luff as high as she would like to.
Cata, I'm amused to see a post saying that the tacking boat will always be clear ahead for a second, accompanied by a diagram in which the tacking boat is never clear ahead. I think the diagram shows that the boats can be overlapped at the moment the tacking boat passes head to wind. In fact, in light-weight boats that slow considerably as they tack, the boats will generally be overlapped at that point, at least if the crossing was tight.
Tactically speaking, it is advisable for Yellow to go a boatlength or so beyond Blue before she tacks. Then Blue can luff if she wants without breaking rule 17, but she can't reach Yellow, so there's no problem if she does.
The net result of the rule change is that rule 17 will apply more often than in the past. This will make the slam dunk easier to perform as Pink does not have to worry as much about being luffed.
The boats are on a beat on opposite tacks so there can be no overlap.
Tactically speaking, it is advisable for Yellow to go a boatlength or so beyond Blue before she tacks. Then Blue can luff if she wants without breaking rule 17, but she can't reach Yellow, so there's no problem if she does.