No your not missing anything. If you move the slider to strict, you won't see much except those files it "Thinks" might be trash, allowing you the option to mark them as not junk.

I have found you don't want to hide them because so many files that aren't junk will be hidden as well.

Crying? Really dumb thing to say.
As for working well, no it doesn't. It works to an extent, but as pointed out, many files that aren't junk get marked junk and you have to mark them as not junk, and the learning never ends. It really has to learn with every new filename.

It is a good attempt with and a good idea, but it doesn't really practically work.