The KWin Smart Window Placement experience considers all the available screen space and the windows that are shown in order to position properly newly created windows.

Unfortunately this technique considers only the windows geometries and as a result Latte can not support it yet. Latte is using window masking in order to slide-out/in. So Latte windows are always using the maximum size that may be needed even when they are hidden.

As a workaround the user can choose:
    Behavior -> Environment -> Can be above fullscreen windows

Future Solution:
1. Latte can support the plasma-style slide-out/in that moves the entire window
2. When Latte is slide-out it updates its geometry in order to be with very small thickness and restores it before starting to slide-in