Looking at the tooltip again, I confirm that. "Belts are cut when sideloading and inside splitters", and here I was expecting it to work when sideloading from a splitter.

I was trying to create a sushi belt, in order to make an automall, and was using the Read-Hold (All Belts) feature to read the contents of the entire belt. I used a splitter to make a lane balancer using the design shown in the screenshot below, where one output from the splitter sideloads directly ...