I am just new to trialing in both venues but I think each one compliments the other. German shepherds were designed to excel at any activity presented to them. Eli and I are consecutively working on agility, obedience and nosework titles. Both agility and obedience teach body awareness. With ob it is close but very precise, I find that has transferred into better turns and wrapping in agility. And agility teaches them to love working the game with you, which transfers excitement into the boring game of ob.
And I don't think the dogs get confused at all. Eli knows the difference between agility obstacles, repetitive heeling and being let loose to search.
But ultimately, it is up to how you present each 'game' to the dog. Harsh training is going to confuse the dog, no matter which venue you are training in. I chose to do agility with him as we were losing his 'umph' with the obedience, and it worked out beautifully