I also noticed this line in dmesg when trying to start a container while the host has index=Y and nfs_export=Y:
overlayfs: disabling nfs_export due to index=off
Unfortunately the Github discussion referenced in the commit is ~9 months after the original kernel commit so it looks like there might be a reason why it’s not possible to set index=on. I added a question to the PR to see if there’s a solution.
I’m also going to look into building the overlay driver directly and see if there is something that can be tweaked to make this work.