Yes that's correctSo if I understood the whole process correctly, the sound we hear on the stream comes from Zak’s PC who at the same time controls the in-game camera. He’s probably together with the casters in a discord channel too so that he can hear what they are saying, is that correct?
Regarding the rest of your idea: I'm not sure that would work, I think the casters wouldn't talk over Zero as it will be harder to hear him that way, which could leave some awkward silences. I think it would also be hard to notice the difference between Zaks voice and the cocasters voice when they start talking, because they are in the same chat, so they don't know if they can talk over it or if they have to listen to their cocaster. In other e-sports this wouldn't really be a problem because there are 2 distinctive "inputs", one from the earpiece and one from having a conversation.