QEMU is underlapping other windows. See below for example.

Version:
sway version 1.0-beta.1-108-gb90af335 (Oct 29 2018, branch 'master')
Steps to produce:
This issue might not be with Sway or wlroots, so please confirm.
Is your terminal transparent?
Yes, it is.
Is your terminal transparent?
In the description:
though this is only visible if your terminal is configured to be transparent
Maybe we should scissor tiled views to their container's bound (excluding popups).
In the description

:wink:
Maybe we should scissor tiled views to their container's bound (excluding popups).
Maybe. In my opinion this is working as designed.
A similar thing happens with gnome-calculator when you have swaybar at the bottom and gnome-calculator doesn't have enough space to fit its minimum surface height. It overlaps swaybar. For example, create layout V[view view gnome-calculator].
@RedSoxFan FYI this is still reproducible after your patch.

@RedSoxFan FYI this is still reproducible after your patch.
I only touched floating clients. Nothing has been changed regarding tiling ones, which is why this remains opens.
I can reproduce a similar issue by setting outer gaps and then opening several gnome-terminal windows. At some point gnome-terminal stops reducing in size and so the last window becomes out of bounds:

It's an extreme situation but the behavior does look incorrect.
Most helpful comment
In the description:
Maybe we should scissor tiled views to their container's bound (excluding popups).