Correct…ish. There used to be a Geo-DNS issue (there are three different Cloud Servers spread across the globe) and sometimes using a hard line (router and device) and cell connection (App) actually connected to two different servers. But I believe that is fully resolved for general App/device use… Using the API method is a different story 
You can code your device to work with or without a Blynk Server connectivity (providing you hard code in some default settings that would normally require App input)…
But the App must connect to the Server to even log in (all your account and project info is stored on the Server, no the App).