Exactly. Also it generally relies on every process everywhere to properly handle an error return from write(). If you launch a big pipe from the shell and just one stage goofs this up and keeps writing after error, the whole thing will stall until you Ctrl-C or otherwise manually kill the process group, which will wreck whatever result you were trying to get from the (already completed successfully!) "head" or "cut" or whatever.

Basically it's a very sane robustness choice and one of the great ideas of classic unix. It's just surprising the first time you stumble over it.