That's my interpretation, too, iaibear. I've also heard the word "hinka" to describe a middle ground between bunkai and oyo.
In Isshinryu we are strongly encouraged to ask questions and come up with new bunkai/oyo. After all - as my sensei puts it - we aren't trying to build robots. Without bunkai and oyo, you've just learned a dance.
Ironfoot, Was it you who trained with Brad, an Ashihara USA Karateka, a few years back?