Exactly, Tim, and I suspect that the TC heard Redwood clearly with but a low heterodyne from 526 underneath. AM reception does not have the "capture effect" that FM reception does (where a signal 3-6db stronger can "conquer" the limiter stage and effectively remove the weaker signal) which is why they still use it for aircraft... unless the difference between the two signals is overwhelming (12-15 db or more) and/or the transmitters are within less than, say 20hz frequency difference you are going to hear evidence of a blocked transmission. It is easily possible for these signal strength differences to occur on the field (despite all the signals being strong) due to larger relative inverse square differences in (the comparatively smaller) distance of the aircraft(s) from the field receiver than with a receiver that is 4-5 miles away (in the case of the LiveATC feed) or 8 miles away as my recordings were captured.
For all we know the TC heard Redwood just fine over top of 526 and, as I said before, could easily have assumed the double (if he heard it) was somebody who had just been handed off by APP trying to get a word in edgewise and who would doubtless try again anyway. 526, not hearing any dispute from the TC after reading back a routine and expected instruction, assumed their read back was correct and proceeded as they thought they had been instructed. The only other unknown is whether the missing instruction for 526 would have been forthcoming had not the event occurred, but it seems to me that would have been a bit later than usual, especially when you look at the actual elapsed time between when 526 was cleared to land (#2 following traffic on short final), when the Redwood instruction was given four minutes later (and 526 was clearly on the ground or at the very least least on short final), when 1295 was cleared to go almost a minute later and when the event occurred 30 seconds after that. So the way I look at it, even if 526 had correctly heard and ignored the Redwood instruction they still would not have received any instruction from the tower at the very least for a minute and a half after landing and possibly as many as three, which seems a bit odd to me, whereas the Redwood transmission would have occurred right about when I believe 526 would have been rolling out.
The slightest change in any of the factors would have made this a nil event... if it was Redwood niner-niner, if 1295 had been on-time, if the butterfly on Agent Starling's lips had been able to flap its wings, etc.
Shvt happens, that's all.