Nope, you aren't correct.
It doesn't strip off the top layer of plastic. It's a chemical reaction and can restore plastic that has not only yellowed on the surface, but all the way through. It can be done to such things with markings on them such as keyboard keys without even hurting the numbers and letters on the key, which wouldn't be possible if what you said is true.
If you actually have tried it and had this happen, then you did something wrong and didn't follow instructions or use the proper materials. It doesn't remove any of the plastic and does restore the plastic to it's original colors. It's been proven time and again at places that document this process through such things as comparison shots of the finished result on a specific computer to something like publicity shots from the period from the company's marketing department of the same model.
It works and there are mountains of evidence that say it does from numerous sources. Here's on such thread from AtariAge dedicated to this process.
http://www.atariage.com/forums/topic...ld-atari-case/
If done properly, these are the types of results someone can expect out of this.
I've seen numerous Super Nintendo's that have been restored to their factory appearance through use of this. In fact I've done it to my SuperNes with the plastic casing around the controller ports (The top and bottom halves of the casing didn't have a yellowing problem) and it restored it to it's factory appearance that matches the other 95% of the casing with no noticeable difference in texture or color.