If you have disabled combat trim in preferences, won't come on at all (even when using auto trim). However if it is checked on, it will disengage once you operate manual trim and will automatically re-engage if you use autotrim (level/speed/pitch) and then override that.
Manual trimming will not override autotrim. It re-synchronises the thresholds for pitch/speed hold (green/red) modes only, not the altitude hold (yellow) mode.
If you are level at say 8k with altitude hold engaged (yellow light on) and now want to climb to say 10k, using manual trim to pitch up will have no effect. You need to either switch to speed hold (red) or pitch hold (green) and then use manual trim up to get you to 10k. Easier imho to just disengage the autopilot by yanking up to 10k and then just re-engage it.