Hi Coca Cola,
Welcome to the forum. I too have a small layout, 38” X 110”. I tried an over/under layout in that space and was able to make it work with 027 tubular track but I wasn’t happy with the arrangement. I wanted to keep the grade to 3% - 3 1/2% and it basically took all my real estate. One of my requirements is to run two or three short trains at the same time so I’m going with a small independent upper level. I want to run trains not constantly watch for derailments.
I used AnyRail software to design my layout before I built it. You could possibly squeeze in an 027 over/under in 31 1/2 X 84 but the grade would be fairly steep.
John