Yes, it should work with decals!
Tried last night and I was very satisfied, covers a lot of limitations that I was facing previously. If there is way to somehow hook the final output stack to the Render to Texture blueprint to generate static textures and not having to worry about the high instruction count associated with this workflow…That would be the cherry on the cake.
While I have not tried this with the Material Layers, you could try using the following How - To as that will work with both Materials and Material instances.
Does it peform any optimizations automatically? Like discarding bottom layers early if they’re fully covered by upper layers?
I was trying to recreate the original MatLayerBlend functions with the new interface, starting with the Override Base Color with an option to input a texture, but for some reason the UV tiling parameter does not work when the Matterial Layer Instance is in the stack. GIFs below. Any ideas?
I’ve been using this to great effect, however there are some things that don’t appear to be working as expected - for instance i’m not able to use a Transform Vector node inside of a layer blend - i get an "Invalid node used in vertex/hull/domain shader input when I use it and plug it into the Alpha of a Blend Material Attributes node.
Noticed something a little strange when trying to work with the new system a little bit. Putting a static switch parameter in the actual material works as normal, but putting one in the material layer itself makes it so parameters from both true and false show up in the material instance. I don’t think it has any performance difference, but usability wise it does clutter things a little bit in the list.
Other than that though, I’m really enjoying the new system so far and plan on changing my project over to use it for a lot of things! The only thing I really wish it had was some way of reducing instructions if a pixel was 100% masked (out of concern for performance using this project wide), but I’m not sure if that can be done.
Alternatively, what I would really love to see is some way to bake down the end result for the standard maps (base color, packed, normals) at a given resolution (or better yet, at a uniform texel density) across the entire project at once for lower spec machines. That way if it does become an issue for some users, there’s an easy way to scale it back in an options menu without redoing the textures for the whole project.
These are very good points! Gears of War 4’s Coalition had a way (in their custom material system) to bake down several layers into flattened ones - but skipping those intentionally marked as dynamic/tiled. The materials seems also to be easy to assign and swap. Unfortunately the presentation is behind a paywall. https://dl.acm.org/citation.cfm?id=3085026&dl=ACM&coll=DL
Spent a bit more time working on it tonight and found a few bugs/problems with the layering system:
If you tweak a material layer enough, eventually it stops updating in the world and doesn’t refresh on a new compile. Requires an engine restart to fix.
Thumbnails for instances don’t update if you change the properties, leading to misleading appearances (so a thumbnail showing a red sphere may really be a green one). If you duplicate the instance however, the new generated thumbnail is correct.
The parent dropdown doesn’t filter the instances properly, it still lets you pick an instance from another material layer entirely. This leads to buggy results and requires a little bit of fiddling afterwards to fix it. Not sure if this is intentional, but it seems like the intent is to have it only show instances for the material layer you pick for the parent, which is a great way of filtering things. Right now though, as stated, it shows instances for every single layer, not just the selected one.
My gosh, this was my dream for so looong! I’ve been working with layered materials for ages!
Not at the moment - but this is something we would like to look into for future updates to the feature.
I passed both of these along to QA to take a look at - thanks for letting us know!
Yep, this is actually on my list to fix 
Awesome, great to hear! The masking is something that we would like to investigate in the future, so thanks for the feedback there as well.
We have seen this with texture parameters and are currently investigating - if you are seeing it with other parameter types, could you upload a screenshot?
This should be fixed in the next preview - and yes, the intended goal is for the asset dropdown to only show instances of the material in the “Parent” field. If that parent is the same in the master material/the parent of the instance you’re currently working on, sticking to the filtered instances should give you more performant variations.
Thanks so much for all the feedback, this is really useful!
Also, for everyone working with Material Attributes, check out the Get, Set, and Blend Material Attributes nodes. They’ll make changing just a few attributes way easier than having to reconnect all the nodes of a Break to a Make. More info about them is in the 4.14 Release Notes
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Sure! Attached is a screenshot of the broken thumbnails, these are being modified with a 3 vector, I wasn’t touching any of the textures.
For the tweaking the material layer until it breaks updating, I wasn’t seeing this in the material instance UI, but just in the normal material editor. I was messing with ways to pack roughness and a normal map in the same texture just to see if it could be plausibly done with the new system, and all of a sudden the engine just stopped caring about me connecting or disconnecting nodes when I applied the changes.
Glad to be able to help!
Is there a difference between that and what I’ve done here (this is the quick dirt layer I made for this new system)? I’m not sure if there’s a drawback to doing it this way, obviously I can just change it to the get/set/blend nodes if they work better.
The final shader should be very similar whichever method you use, the change is more in authoring the graph. When using Get/Set instead of Make/Break it generally gives you a smaller graph and will be better protected against potential future changes, e.g. new attributes can be added in later without having to re-connect an extra pin required by the Make/Break nodes. If you’re using “built-in” engine functions you shouldn’t need to worry.
Had less time to play with this…
First… system is avesome… our master material contained 100 static switch to handle all of “our” possible requirements 
Now finally i dont need wait 5k shader compile when new feature is requested.
btw, maybe i am wrong, but uv scale is not working in layers?
Refs:
Can confirm this. I have been trying to wrap my head around ML and just when I thought I had a good working example I run into this lol. The Background works fine and an exposed shared input connection works fine but once I add in an additional layer the extra layers do not honor that shared input setting for the UV tiling and the exposed parameter shows “Multiple Values” instead of what is expected. You cannot also set the value this way once this has happened.
Hi all! We’re currently looking into the UV scale issue, but the thumbnails not updating should be fixed in 4.19 Preview 2!