I’m attempting to use MDecal (per panda3d.org/manual/index.php/Texture_Modes) with a scaled down and offset texture. However, the textures tiles over the entire UV space (covering up the initial texture) regardless of offset and scale.
I assume you mean that adjusting the offset and scale will change the placement and number of decal textures you see over the entire space, but you don’t see through the decal texture to the underlying texture anywhere.
This is normal, assuming you have repeat mode on your decal texture (which is the default for any texture). If you want only one copy, then turn off repeat mode: