Terrain displays the checker texture in Unlit Draw Mode despite a base texture layer being set

Steps to reproduce:

1. Open the attached project
2. Open the Test scene
3. Enable Unlit Draw Mode in the Scene View
4. Observe the checker texture overlaid with the base layer texture

Reproducible with: 2023.3.0a17, 2023.3.0b10

Not reproducible with: 2022.3.19f1, 2023.3.0a16

Expected result: the checker texture is not visible

Actual result: the checker texture is visible

Note: note reproducible with URP

Tested using Mac OS