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For example, if I have the Messenger bubble open in the foreground and I am browsing through my photos in the background, can an app like Messenger see the photos in the background and record this data? Not only Messenger but other apps that have this permission?

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The official developer docs do not mention any such possibility with Draw over other app (SYSTEM_ALERT_WINDOW) permission. Apps with that permission can only receive touch feedback, like other apps.

See:

However, any app with Accessibility Service enabled can read the content of the active window.

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According to a Medium article by Jeffrey Yasskin,

Allowing an app to draw over other apps is incredibly dangerous: By seeing what you press, the app can easily steal passwords. It can present messages as if they’re from other apps or read those messages. You have to trust any overlay app at least as much as you trust any other app on your phone.

It’s great that Android makes overlays possible, but it’s also great that it makes it hard to do accidentally.

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    Perhaps it's a bit unclear what the quoted paragraphs are trying to convey, but to clarify: the overlay can read the content actively by intercepting touches (i.e. over the keyboard), but cannot read the background content passively.
    – Andrew T.
    Commented Oct 23, 2022 at 9:52

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