That explanation makes sense, thanks! In particular ... always decodes, then works on uncompressed data. But - that means double transcoding for a recording taken from a streaming source, like a browser (right?).
There's the encoding step before it even gets to the browser. OBS undoes that, but of course it can't add any information that it doesn't have. Whatever the first encoder threw away is gone forever and replaced with compression artifacts. The degradation happens entirely in the *encoding*, not the decoding.
Then there's the encoding that OBS itself does, on the way out from OBS.
If that's how you're counting, then yes, there would be two generations there, to use the "generational loss" term. Whether that's noticeable yet, is up to you.
I want to try to avoid the quality impact of double transcoding ... so "live to tape" sounds interesting. Is there more info on that somewhere?
There's not really any more to explain. OBS still decodes what it gets and encodes the final result. You still can't escape that. "Live to tape" simply takes that encoding and dumps it to a file instead of an actual live stream.
Imagine two on/off switches after it's all said and done, and both are after the encoder: one is for the stream, and it goes straight to the internet from there, and the other is for the recording, and it goes straight to the file from there. Before the encoder, there's no difference whatsoever, and it must go through the encoder.
If you imagine that you're producing a TV show, it makes a lot more sense, and that's really what OBS is meant for anyway.
You can set OBS's encoder to not throw away very much, if at all, but like I said, that produces a huge file! Very rarely is it actually worth that much storage space for the amount of video that you get.
For a browser, to disk ... is that an option?
Only if the browser itself supports it. You might see what a regular browser does with the "Save As..." option, or right-click -> "Save Link As..." or whatever your browser calls it. Not in OBS at all, just your regular web browser.