Here's the .Cap: https://dl.dropbox.com/u/28484936/layer_effect_example.cap
In this simple example I have 3 layers. The background layer (with the circles), the middle layer (checkered) and the top layer (the gray semi-transparent mask with a hole in the middle).
What I want is for the middle layer (checkers) to only show through where the hole is. Any part of the checkered layer that is covered by the grey area should be invisible, while the background (circles) should show through normally. The end result should look like this:
For the sake of this example I put all three of these object on separate layers but they don't necessarily have to be laid out like this. Any ideas? Thanks!