They way I do something similar is have 2 thru machines, One for input AB and one for input CD and I then use 4 flex machines playing back the the recorded inputs and I pan each one like :
1 Flex Thru Input A left > Main Out Left
2 Flex Thru Input B Right> Main Out Right
3 Flex Thru Input C Left >Cue Out Left
4 Flex Thru Input D Right>Cue Out Right
This way the tracks coming in get processed in the Octatrack and then get sent out without each track interfering or getting mixed with each other. Also you don’t have to mute the source you can just mute the channels on the Octatrack. From there you setup transitions between the Thru’s and the Flex’s enabling you to mangle and effect the inputs and have each kept separate when sent back to a daw or mixer.