I believe this is mostly to stop streaming.
For years and years, Sky have had issues with people buying multiple subscriptions to their sports packages, connecting the receivers to a bunch of servers, and then reselling access on commercial streaming sites!
The big difficulty they've then had is identifying who's behind the streaming site, and at the least, shutting down their stream.
The fun part is that - judging by the number of sites that remained in operation for a good chunk of time - it does appear possible to operate an essentially anonymous business on the internet.
Even with only two channels, I expect you could binary search it down to a single receiver over the course of a single season of matches.
I've been informed that some streaming services simply cut off the side of the screen where the Sky logo starts to appear.
I wonder if they also use something like Digimarc for a non-visible watermark? They could publicly credit the visible watermark as a distraction from the real technique.
A similar thing shows up on YouTube a lot, actually. People heavily crop uploads of copyrighted material to get around their content identification stuff.
Doing the overlay in the smartcard would make it a harder target, if the smartcard has the processing power to do it.
I wonder how easily the firmware can be downgraded (or downgraded) to remove that behaviour. Though as noted in the sibling thread, it's more likely easier to crop the video output.
I wouldn't like to bet against the number appearing right in the centre of the screen for a fraction of a second, if there were any particularly high-value programming being illegally streamed.
I'm only aware of one time that a legitimate box was encouraged to run a lightly-patched version of the software, and that involved a JTAG-type attack on a specific model of set top box. I believe that lesson has been learned in current models.
(2012)
Now most illegally suppliers have switched to IPTV.