The overlap, had this been a production weld, it would bother me a lot. It must be removed and repaired and welder must be retrained, if not let go, period! There is no excuse this this type of workmanship from experienced welders.
The Northridge earthquake report, along the Fema 350, 351, 352 & 355A through F all contain good information.
The photo - I keep a library of photographs and samples that I use to train NDE technicians and welders. In the case of this weld I was attempting to create a centerline crack after have production problems. Porosity, undercut, overlap and lack of penetration are easy defect to create, cracks are harder, so when I stumble on a technique I take full advantage of it.
The unmelted flux in the weld is the key to solving this problem. By being unmelted we did not get the welding alloy transfer from the flux to the weld pool.
BTW the crack does not break the weld surface. There are no PT indications, weak indications with AC MT and much stronger with DC and Pulse DC MT.