OK, here's a .rar of a demo project with the problem:
https://www.box.com/s/f793b519a287600c2cf1
I recorded 3 chords on the guitar, then cut around the second chord to create a separate item. I then copied and pasted everything over to the right, to give a 'before and after' type of scenario. On the right hand one, I selected the middle clip, and in "Record mode: auto-punch selected items", hit record before the clips. As you will see, it has just recorded over the whole lot, not just the selected clip.
It's probably me missing some setting or something...
Any help appreciated.