AWS VPC peering response traffic - can return address CIDRs overlap?

Solution 1:

In the link to the AWS doc I would say that the answer is below the diagram. If traffic originates in Subnet B of VPC B it's the route table in VPC A that determines whether the traffic get's back to the correct sender.

Initially the answers is it will not because the route table in VPC A says "send traffic destined for 10.0.0.0/16 to VPC C".

However you can provide more specific routing by adding routes to VPC A's route table with a smaller CIDR block (bigger CIDR number). So for example if the traffic origintaing from VPC B came from 10.0.1.66/32 then add this destination to the route table of VPC A and make sure it gets sent over the correct VPC peer (i.e. to VPC B).