Yes, that is true, and the top 3 seeds may get to choose where they will skate. But hosts can pick seed #6 instead of #4, and of 7-12 at Worlds, 10-12 rather than 7-9. Hosts are also aware of which skaters start off slowly in the early season.
MEN:
Skate Canada picked #6 RIPPON as their second seed rather than #4 Abbott (who won SC last year) or #5 Brezina. From Worlds 7-12, they picked #8 VAN DER PERREN, who doesn't usually skate well in the early season, and #12 FERNANDEZ.
The others:
ODA - DNQ for the FS at Worlds. Was #4 WR (World Ranking), #6 SB (Seasons Best list)
PREAUBERT - Did not compete at Worlds. #8 WR, #24 SB
GACHINSKY - #3 JW. #21 WR, #33 SB
NANRI - Did not compete in an ISU Championship. #34 WR, #60 SB
HOCHSTEIN - #5 JW. #33 WR, #38 SB
BERNTSSON - #15 Euros. #36 WR, #43 SB
BACCHINI - #16 Euros. #54 WR, #45 SB
Oda was picked because he trains in Canada and is popular with Canadian fans. On paper (based on WR and SB) Gachinsky and Preaubert were unlikely to give Reynolds much competition; Nanri, Berntsson, Bacchini and Hochstein were likely selected to help Jeremy Ten place above the bottom 4.
That is not to say that Canada is the only host that plays this game.
Except for #4 seed BREZINA (who reportedly has an injury) and Worlds 7-12, the TEB men's field is also on the weak side:
Worlds 7-12: #11 REYNOLDS, #22 WR, #20 SB; #8 KOZUKA, #13 WR, #12 SB
VORONOV - #16 Worlds, #14 Olympics, #16 WR, #15 SB
MROZ - #4 4CC, #23 WR, #23 SB; 7th and 8th in 09-10 GP
SONG - #1 JGPF, #2 JW, #17 WR, #29 SB
KOVALEVSKY - #16 Worlds, #43 WR, #41 SB
LIEBERS - no ISU Champ (injured much of last year), #50 WR, #54 SB
KELEMEN - #29 Olympics, #138 WR, #73 SB



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I was mesmerized from beginning to end. I've always liked his skating, but now I can truly say that I'm love with it!
Adam then spent a bit of time in a corner of the rink signing autographs for a few fans, but the professional photographers were eager to take snapshots of the three medal winners (Patrick and Nobu were already on the other side of the rink facing the media). The announcer (whom I didn't expect to hear from again) suddenly said over the speakers with his booming voice, "Adam. Adaaaaaaam. Sorry, we need you at the other corner, please!" 

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