I think this is working as intended - consider this: the setting causes the storage to lock the output of material due to the max capacity therefor nothing leaves the storage. so it's like saying "don't allow any product to leave the storage on belts"
this is the opposite of all the way to the left that means "as soon as there is product in the storage it can be output"
the title is misleading - it should be something like "tool tip for output limiter is misleading when the limiter is set to the right edge", since you're expecting the output to flow only when the storage is full of product, if I understand you correctly
Ps - I still use the old way of pausing the output belt because I didn't think of this... 😄