Well, no, it isn't because Excel actually changes the underlying data too. It's more like changing the formatting of all the files in the project and deleting all the characters after the 80th column.
I just tested it. The setting applies on data entry but opening a CSV or similar delimited file counts as “data entry”. So if you work strictly with xlsx files you are fine but it will irreversibly convert the values on open for delimited files unless you change the defaults.
