Reached through DEPTH_ORDER. IY is behind the candidate, so it becomes the candidate instead -- unless it is already in the chain of objects that have been candidates since the last draw (CANDIDATE_CHAIN), in which case the order has gone round in a circle and IY is drawn straight away.

Nothing checks the chain's length: CANDIDATE_CHAIN has room for fifteen numbers and the $FF, twice Knight Lore's, and a sixteenth link would put its $FF on the first byte of FILL_RECT. Measured over every room's first turn: the longest chain is 9, in the four start rooms, and four rooms go past Knight Lore's 7 -- so Knight Lore's eight bytes would have overflowed here (that this is why it was doubled is an inference).