Correct.
The limit relates to the number of threads which can be featured at any one time.
Once the expiry date is reached for each individual thread it will be automatically unfeatured.
Changing the option value will also automatically unfeature the oldest threads over the new limit.
So if you currently have it set to 0 and have 50 threads featured, if you change it to 20, the 30 oldest threads will be unfeatured.