No, you're close. The problem with power off recovery is that while the OS is supposed to read that switch and execute a "soft" landing for the operating system (cleaning up the disk directory, finishing writes to the drives, etc), the fact is that if your system is so hung up that you think you need to do the power off there is no guarantee that the OS will, in fact, do that soft landing before the drive firmware retracts the heads to their landing position. And if the directory isn't clean, or the write of files isn't gently brought down, you can end up with an unreadable drive or lost files. And if the system is even more messed up and ignores the soft switch, it's even worse to just yank the plug out of the wall on a machine without a battery, or remove the battery of a laptop to "kill" it. As soon as the HDs see power loss, they immediately retract the heads on the dying voltages and all writes are aborted. It's not the circuit boards, it's the drives!
Yes, I'm paranoid about this. I ran a major data center and one of the cleaning crew toyed with the power switch on a bank of Unix machines and they all crashed, which led to days and days of recovery work. We ended up putting a lock on the cover of the power switch just to keep people from playing with it.