diff --git a/.changeset/sturdy-otters-chatter.md b/.changeset/sturdy-otters-chatter.md
new file mode 100644
index 000000000..70bd6d0e2
--- /dev/null
+++ b/.changeset/sturdy-otters-chatter.md
@@ -0,0 +1,5 @@
+---
+type: Fixed
+pr: 3938
+---
+**`workflow.use_worktrees=false` now actually wins for executor dispatch** — `query dispatch-isolation` folds the project opt-out into the isolation sentinel it records, so a plain re-query can no longer re-persist the host's worktree capability over the mandated `none` record and have the isolation guard deny the sequential dispatch the project configured. (#3737)
diff --git a/gsd-core/bin/gsd-tools.cjs b/gsd-core/bin/gsd-tools.cjs
index 1760e4e16..058c101f4 100755
--- a/gsd-core/bin/gsd-tools.cjs
+++ b/gsd-core/bin/gsd-tools.cjs
@@ -1706,6 +1706,30 @@ function dispatchOverlayCapabilityCommand({ command, args, cwd, raw, error, load
           }
   }
 
+  /**
+   * #3737 — strict read of the project-level worktree opt-out from
+   * `.planning/config.json`. True ONLY when `workflow.use_worktrees` is the
+   * boolean `false`; an absent key, unreadable/malformed config, or any
+   * non-boolean value (including the string "false") degrades to false —
+   * worktrees are ON by default, so the degraded answer is "not opted out".
+   * Direct file read, deliberately NOT loadConfig: this resolver backs
+   * sentinel writes and must never trigger config normalization/rewrites
+   * (same discipline as resolveDispatchIsolationDecision's resolveRuntime
+   * comment above). Never throws.
+   */
+  function projectWorktreesOptedOut(cwd) {
+    try {
+      const { planningDir } = require('./lib/planning-workspace.cjs');
+      const cfgPath = require('path').join(planningDir(cwd), 'config.json');
+      const cfg = JSON.parse(require('fs').readFileSync(cfgPath, 'utf8'));
+      return cfg != null && typeof cfg === 'object'
+        && cfg.workflow != null && typeof cfg.workflow === 'object'
+        && cfg.workflow.use_worktrees === false;
+    } catch {
+      return false;
+    }
+  }
+
   function routeDispatchIsolation({ args, cwd, raw, error }) {
     // #2584 Phase 3 (#2627): typed query exposing the negotiated
     // `dispatch.isolation` to the execute-phase wave scheduler, so the
@@ -1779,6 +1803,25 @@ function dispatchOverlayCapabilityCommand({ command, args, cwd, raw, error, load
       ? args[planIdx + 1]
       : null;
 
+    // #3737: the project-level opt-out (workflow.use_worktrees === false) is
+    // decided HERE, before the sentinel write — not only in the workflow
+    // shell blocks that run after this resolve. Pre-fix, any plain re-query
+    // (config re-read, wave transition, second plan dispatch) re-persisted
+    // the naturally-resolved host capability over the `--force-isolation
+    // none` record the dispatch-isolation reference mandates, and the guard
+    // then denied the sequential dispatch the config explicitly asked for.
+    // Applied AFTER --force-isolation so the documented rule holds: the
+    // opt-out wins on every host, over both the natural resolution and any
+    // force. Strict `=== false`: the default is worktrees ON, so an absent
+    // key, an unreadable/malformed config, or a non-boolean value degrades
+    // to "not opted out" (mirrors readConfigJsonBoolean's no-coercion
+    // discipline in lib/init.cjs).
+    if (projectWorktreesOptedOut(cwd)) {
+      isolation = 'none';
+      harnessFlag = null;
+      exec = null;
+    }
+
     // Side-effect write (#3045 CORE REDESIGN) — see the doc comment above.
     // Never allowed to affect this query's own stdout contract or throw.
     try {
diff --git a/tests/gsd-agent-isolation-guard.test.cjs b/tests/gsd-agent-isolation-guard.test.cjs
index a6cb75f38..763ff020c 100644
--- a/tests/gsd-agent-isolation-guard.test.cjs
+++ b/tests/gsd-agent-isolation-guard.test.cjs
@@ -937,6 +937,116 @@ describe('#3045 CORE REDESIGN — dispatch-isolation records as an unconditional
     assert.equal(read.phase, '2');
     assert.equal(read.plan, 'p1');
   });
+
+  // #3737 — the project-level opt-out (workflow.use_worktrees === false) is
+  // decided by the workflow shell AFTER the resolve, so pre-fix any plain
+  // re-query re-persisted the naturally-resolved host capability over the
+  // mandated `--force-isolation none` record, and the guard then denied the
+  // sequential dispatch the config explicitly asked for.
+  function writeUseWorktrees(dir, value) {
+    fs.writeFileSync(
+      path.join(dir, '.planning', 'config.json'),
+      JSON.stringify({ runtime: 'claude', workflow: { use_worktrees: value } }),
+    );
+  }
+
+  test('#3737: use_worktrees=false — a plain re-query records none and does not clobber the forced record', (t) => {
+    const dir = createTempProject('gsd-3737-optout-');
+    t.after(() => cleanup(dir));
+    writeUseWorktrees(dir, false);
+
+    const forced = runGsdTools(
+      ['query', 'dispatch-isolation', '--raw', '--force-isolation', 'none'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(forced.success, true, forced.error);
+    assert.equal(forced.output.trim(), 'none');
+
+    // The workflow's own re-record step, then the plain re-query that pre-fix
+    // flipped the sentinel back to harness-worktree (#3737 reproduction).
+    const requery = runGsdTools(
+      ['query', 'dispatch-isolation', '--raw'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(requery.success, true, requery.error);
+    assert.equal(requery.output.trim(), 'none', '#3737: the opt-out must win on every host');
+    const sentinel = readSentinelRaw(dir);
+    assert.equal(sentinel.isolation, 'none', '#3737: a plain re-query must not re-persist the host capability over the opt-out');
+    assert.equal(sentinel.harness_flag, null);
+  });
+
+  test('#3737: use_worktrees=false resolves and records none on the first plain query (--json agrees)', (t) => {
+    const dir = createTempProject('gsd-3737-optout-');
+    t.after(() => cleanup(dir));
+    writeUseWorktrees(dir, false);
+
+    const result = runGsdTools(
+      ['query', 'dispatch-isolation', '--json'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(result.success, true, result.error);
+    const parsed = JSON.parse(result.output);
+    assert.equal(parsed.isolation, 'none');
+    assert.equal(parsed.harnessFlag, null);
+    assert.equal(parsed.exec, null);
+    const sentinel = readSentinelRaw(dir);
+    assert.equal(sentinel.isolation, 'none');
+    assert.equal(sentinel.harness_flag, null);
+  });
+
+  test('#3737: use_worktrees=true keeps the natural harness-worktree record', (t) => {
+    const dir = createTempProject('gsd-3737-optout-');
+    t.after(() => cleanup(dir));
+    writeUseWorktrees(dir, true);
+
+    const result = runGsdTools(
+      ['query', 'dispatch-isolation', '--raw'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(result.success, true, result.error);
+    assert.equal(result.output.trim(), 'harness-worktree');
+    assert.equal(readSentinelRaw(dir).isolation, 'harness-worktree');
+  });
+
+  test('#3737: a non-boolean "false" string is not an opt-out (strict === false)', (t) => {
+    const dir = createTempProject('gsd-3737-optout-');
+    t.after(() => cleanup(dir));
+    writeUseWorktrees(dir, 'false');
+
+    const result = runGsdTools(
+      ['query', 'dispatch-isolation', '--raw'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(result.success, true, result.error);
+    assert.equal(result.output.trim(), 'harness-worktree', 'a string "false" must degrade to the default (worktrees on), never coerce');
+    assert.equal(readSentinelRaw(dir).isolation, 'harness-worktree');
+  });
+
+  test('#3737: end-to-end — an opted-out project records none and the guard ALLOWS the sequential dispatch', (t) => {
+    const dir = createTempProject('gsd-3737-optout-');
+    t.after(() => cleanup(dir));
+    writeUseWorktrees(dir, false);
+
+    // The workflow's resolve step: a plain query (no force) records the
+    // opt-out decision — the record the issue says must survive re-queries.
+    const result = runGsdTools(
+      ['query', 'dispatch-isolation', '--raw'],
+      dir,
+      { GSD_RUNTIME: 'claude', HOME: dir },
+    );
+    assert.equal(result.success, true, result.error);
+    assert.equal(result.output.trim(), 'none');
+
+    // The guard fires on the sequential inline Agent() dispatch (no
+    // isolation kwarg) and must NOT deny it (#3737's user-visible symptom).
+    const r = runHook(agentPayload(), dir);
+    assert.equal(r.status, 0, `guard denied a sequential dispatch under the opt-out sentinel: stdout=${r.stdout} stderr=${r.stderr}`);
+  });
 });
 
 describe('#3045 MAJOR — --harness-flag can now accept a bare CLI-flag value (Cursor real registry value + generalized parsing)', () => {