Yes, you are correct.
Unfortunately, the black-flickering is caused by Windows in the way Windows handles transparent windows. Transparent windows in the current versions of Windows are a bit of a quick hack added by Microsoft to Windows. The "reduce flickering" is a hack in ShellEnhancer to try to prevent the black-flickering. Unfortunately this can cause a performance issue with large windows.
We'll have to wait for Windows Longhorn and ShellEnhancer for Longhorn to have perfect transparency