The core SourceT<M> has improvements:

• The | operator which takes the left-hand stream and right-hand stream and merges them into a single stream can now handle errors emitted from either stream and propagate it up through the reducer. Your M type must support Fallible<M> for this to work.
• I have rewritten the internals of StreamT.lift(Channel) to use the new Monad.Recur functionality - this removes any risk of stack-overflows with your bespoke M types (assuming you've implemented Monad.Recur correctly.