How do you deal with the giant foundation overhang when using ridged foam and a rain screen on an exterior wall?
I think the overhang is actually the better idea.

Imagine you are a water droplet running down the wall. With an overhang, you are more likely to fall harmlessly to the ground to be drained away. If you design the wall so that the slab and wall are even, that water is much more likely to wick under the wall and begin the long term destruction of the bottom of the wall.

The deeper the eaves on the roof and the wall overhang on the slab, the less likely you will be to have wall leaks and water damage.

If you want to seal the bottom of the wall you could install Z shaped flashing over the foam and under the siding.

Good luck!