I set mine to Continuous to ensure I capture everything, even things the camera events may miss.
With that said, in both cases, the SD Card will restart from the beginning when it hits the end of the storage. Basically overwriting the earliest recordings. It will not stop recording in either mode.
If you have Cam Plus, you will get events, which are stored for 14 days in the cloud.
Adding an SD Card allows for Continuous or Events to be recorded to the card. When the card hits the max or is full, the earlier recordings will be overwritten. At that point, those events will be gone, but the newer ones will remain on the SD Card.
I want to make sure you understand that Event vs Continuous recording and Timelapse have no relationship with each other - other than they are both using the same uSD card space for recording.
Whether you use Events of Continuous recording, those record until the card is full and then start deleting the oldest recordings to make space for new recordings. How long it takes before old recordings are deleted depends on how large the uSD card is and if you are recording continuously or events only (and how many events you get). Timelapse records do not get overwritten as the card gets full, but they take up available uSD card space. So, using your rather small 32GB uSD card, if there are no Timelapse recordings, then essentially all of that 32GB card is available for continuous or event recordings. If however there is a 7GB TimeLapse, now only 25GB is available for your continuous or event recordings.
Now for my opinion, set the camera to continuous recording to make sure that some event is not missed, and use larger cards. I am using 64 or 256GB cards - primarily using the 256GB cards in cameras that have LOTS of motion (as that does take more space) such as the cameras in my vehicle.