no, this isn’t fully correct. The first time you boot your phone, you have to unlock with your PIN. This decrypts your user “partition” that holds all your data. Imagine all the crap you produce including apps goes in that partition. The base operating system, what you get from the factory, is in a separate partition that is NOT encrypted by you. So what this repair mode does is basically take advantage of the already built-in DSU functionally for booting generic kernel images (GKI) and instead use it to boot a copy of your system. Your personal data remains fully encrypted.