[Essential Phone ROMs, Kernels, Recoveries, & Other] starcms:
Sorry that it took a few days to get back to you, I was taking a break from this thread. I'm not going to answer each of your specific questions, but try to answer it all. If you have any more questions, hit me back.

TWRP.img and the TWRP installer zip are two very different animals.

TWRP.img is a boot image that will only boot to TWRP (never to Android) and that touch will only work on it if the slot you flash it to has an August or earlier version of Android installed (because twrp.img is based on the August boot image and in September, some partitions of the firmware called hyp and rpm were updated for the first time ever. These 2 partitions, hyp and rpm, affect at least the touchscreen and wifi working. So flashing TWRP.img to September or October will result in no touch in TWRP on that slot). Regardless twrp.img will never boot to Android.

The TWRP installer zip has inside of it a script and a ramdisk module that contains TWRP. The script injects the ramdisk into the boot image on both slots. So no, TWRP.zip does not overwrite twrp.img -- it modifies it with something it already has, a ramdisk that contains TWRP (so it has zero effect on twrp.img). On your other slot that doesn't have TWRP.img flashed to boot (but instead still has the original boot.img that matches whichever version of Android is on that slot), it installs TWRP into that boot image by modifying it's ramdisk . So, again, what TWRP zip does is modify the ramdisk of your boot image (it doesn't modify or change any other part of the boot image such as parts dealing with touchscreen, making the boot image not compatible with the version of Android on that slot, etc).

The only purpose of twrp.img is so that you will have a way to flash the TWRP installer zip. If touch doesn't work in TWRP.img (because you have September or newer on your inactive slot), simply look at my post #86 in this thread which has instructions and 2 adb commands that allow u to flash TWRP.zip from twrp.img even when touch doesn't work in twrp.img.

Once you have TWRP permanently installed, keeping it through every monthly update is extremely easy. Simply follow the instructions in post #202 in this thread. You can do it from your couch without a PC in about 30 seconds (ignoring the install time of about 5 min).

Hope u actually read that and haven't given up waiting for a reply and hope it clears things up. I think now you'll completely understand it, or be much much closer at least.

---------- Post added at 06:09 ---------- Previous post was at 05:47 ----------

But I don't understand how it can work. Because for the actual over-the-air OTA to install from inside Android (and not give an error), the original boot image (without TWRP or Magisk) must be flashed back on the active slot. So if you take and install the OTA, and then before rebooting, run the TWRP Magisk module, it's not going to have any ramdisk with TWRP in the active slot to patch the non-active (soon to be active after reboot) slot's boot image with.

What am I missing here?

Edit: If you are flashing the TWRP retain zip that came from Magisk in TWRP after installing the OTA from TWRP, then it serves no purpose because instead of flashing the TWRP retention zip that came from Magisk, you could simply flash the TWRP installer zip. It isn't reducing or changing any steps. You are also missing the entire point of osmo0sis' TWRP retain zip from Magisk. It is meant to be flashed from Magisk Manager while in Android. That's the whole point of it -- to avoid the need to use TWRP at all.

---------- Post added at 06:18 ---------- Previous post was at 06:09 ----------

This would have nothing to do with preventing touch from not working or anything else for that matter. The only purpose this has is you don't have to remember which slot was the active one when you started.