DISCLAIMER: All this is WIP!
Library overrides are essentially local and editable data created from linked one.
Reference data being linked (and therefore fully constant, non-editable whithin a Blender session context), the overrides can be re-created from that linked data when opening/loading the .blend file. Overrides data then behaves as a regular local data (with some limitations).
Library Overrides are defined at a data-block level.