Correct. When you lightly press the brakes you will see the power meter needle go down indicating regenerative braking (grey area on diagram). If you apply more pressure the needle will max out and all extra effort is provided by the mechanical brakes - it doesn't switch from one to the other, it will provide more force with the addition of mechanical brakes, and it can apply those and modulate the force in a fraction of a second.
As the generation of electricity from the motor/generator is related to speed, the amount of braking force felt is less a higher speed, hence the curve. The motor itself can generate more power than the batteries can cope with being charged so the drop off curve is quite steep. If you have a full battery, or the batteries are too hot, the regen braking force is much less than the graph.
Some people do complain about the brake feel, and that if you gradually apply more pressure you can feel when the mechanical brakes take on most of the work. On the 400h I find it very subtle though. It is more pronounced if the mechanical brakes haven't been bled correctly, or non-standard discs/pads are used as their initial grab may be different to OEM.
At the very left of the graph you will see all white. At speeds around 5 mph or lower, all braking is mechanical - this is something you can sometimes feel, as you slow to a stop, where is does switch from one method to the other.
As you say, it is better to drive two or three so you understand what is normal and what isn't.