Summing up, the original inheritance hierarchy can be re-stated as shown above. Prototypes are an optional part of the inheritance chain - they are part of it only if a note is set to use a prototype†. Otherwise a note inherits from document level defaults.
It has also been shown that whilst local values trump inherited ones, it is still possible to re-enable inheritance, offering a lot of flexibility.
†. Prototypes can inherit from other prototypes, so there may be several in the chain between the document level default and the inheriting note. However, this behaviour is uncommon and only needed in more specialist documents with a highly defined rule-based structure. Intrinsic attribute values are never inherited.
Back to the cascade overview…