I don't favor making this a full-screen overlay. In addition to the annoyance factor and (legitimate) complaints about wasteful use of space that this would provoke, it would destroy the ability to see what your changes will look like in actual use, since it obscures whatever you were doing at the time when you decided to change the settings.
as written on Telegram, added here per your request:
I think the idea of the handles is fine, personally I still think it's a bit much to full-screen it, on my dockstation monitor this will be a huge waste of space and cover window content I might like to see
as right now it is rather compact
If I understand correctly, when you guys resize your panels, you like seeing what the windows behind are doing, right?
And that's even though when resizing panels, you won't be interacting with the content on the rest of the desktop
Well, the thing is not only there when you resize panels, but also when you e.g. add or remove widgets, if it behaves like the current one.
Also at least on vertical resize the placement of windows might be important, so I think it does cover a bit much screen estate.
Honestly I don't feel that the current UI needs that many changes. Maybe we could learn a bit from Latte Dock's customization interface, if necessary:
Maybe I sound now a little bit heretical but why not replace the plasma panels with latte-dock at all?
The project has become quite popular over the last months and not only for Plasma or KDE enthusiasts.
Quite much work has been done and it is even able to mimic the look and feel from the default plasma panels while offering quite more features and being a way more flexible.