This doesn't apply to any games I'm playing now, but in your opinion, if a covenant were set in a regio within a major city, would it make sense to apply both the Regio boon and the Urban major Hook? Or would the regio most likely limit outside influence enough to warrant Urban becoming minor or even not qualifying as a Hook? Again, your general opinion, so it may be prone to exceptions.
As with everything, it depends. If the covenant is nearly impossible to enter without 'inside assistance' and they don't need to draw on external resources to any amount, then Regio/City kind of nullify each other. If the covenant is in a regio in the city, and people can enter the regio accidentally (much as 'Golden Baghdad' in Cradle and Crescent), then those two work together nicely.
Even if it is nearly impossible to enter the Regio by accident, I could see a mess of trouble from living inside a regio inside a city.
Think of the neighbours, of the nasty rumours that come from people comming and going. And there are just how many of them living in that tiny space? etc.
Sounds like Howl's moving castle (the manga movie) if accidental entries are very rare (there is only one in the manga, despite having 4 clearly defined entry points)
You apply them if you play them.
If the regio cuts down on the outside influence, then yes, you should revalue the hook.
It's your choice, though.
It certainly matters if the nature of the regio is tied to the state of the city.
The Surroundings City Hook covers being near the city as opposed to being within the city. If you want to be technical you could just use that hook instead. A good story guide should have no trouble finding ways to involve the covonant in city politics and vice versa no matter how "controlled" the access is to the regio.
Personally I've seen the situation in more then one saga I've played in. I've considered trying it a different way. What if along with the covenant there's a whole city contained in a regio.
Taking a hook means you want stories about the hook, when it all comes down to it. Do you want the stories to center on the covenant being in the city? Then Urban is appropriate. The regio boon is quite simply a way of giving the covenant access to a regio and limiting the stories that are focused on the regio. Now keep in mind that the regio boon doesn't keep the ways into the regio perfectly secure, so the Regio boon can be combined with the Urban hook, in that sometimes inhabitants of the city somehow make their way into the regio. I'd probably make it drunks, after dark, who are singing songs, or something, and it's an alternate way of crossing a certain regio boundary. Or something.
I'm currently running a saga where the players took that exact combination. The covenant is in a regio, whose entrance they fully control, in the midst of Constantinople. They took both "Urban" and "Regio", and both have seen abundant use in play. The fact that people in the city can't access the covenant at all if the magi don't want them to does nothing to dillute the hooks and troubles of being inside a city. I mean, magi still need to get into and out of their regio/covenant through the city, still need to have all their food and supplies purchased in the city, and still need to deal with everything that's going on in the city.
The fact that they live in a regio and can close it off only means they have a safe place where they can be sieged to starvation, if things went down that road. Which I'm sure wouldn't, since fleeing the place would be a much more sensible course of action, if all came down to that kind of physical confrontation.
So no, IMHO that Boon/Hook combination doesn't negate itself, as long as you see the Hook as a source of stories, not a weapon to be swung at characters.