Yes, that is correct. Water is a better cooling and heating medium than air.
GM engineering states the ideal trans temp is above 150 F degrees, and below 195F. Too low does not allow for a correct flow in the internal parts; too high and the fluid is destroyed.
Dexron IV is rated for 100K miles at a trans temp below 205 F degrees. If you run it at 220 F all the time, it would need to be changed at 50K miles, if you run it at 315 F, fluid will last only 2K miles (Not counting that at extended periods about 260 F will cause seals and plate material to self-destruct.)
However, the temps are accumulative; so that if for a few thousand miles you tow in the summer and hit 240 F does not mean the trans fluid has to be changed at 25K miles.
That's why it is recommended that if you tow, or live and drive in a mountainous area (and other caveats) you change the trans fluid at 50K vs. the normal 100K.
(New GM vehicles since around 200/2009 were shipped with Dexron VI, which is a heck of a lot better fluid than Dexron IV, so that chart is not that accurate since Dexron VI will last longer at higher temps and flow better and lower temps.)
I'll note that this internal cooler failure is not that unusual, and happens a lot to vehicles that are severely off-roaded (vibration is a killer). I actually replaced my radiator at 50K on my H3 just for insurance. And I also have installed an external trans fluid air cooler to help reduce the temps while towing and riding at highway speeds in the mountains.