I agree with your explanation, but that's kinda where my issue with it is. If what I see is completely different than what the game engine says happened, then it's broken. I'm not angry about it by any means, but it can be frustrating, especially on a 4th quarter late game drive.
For example, I was up 30-19 (I think; I know I was up by 11). The CPU drove down the field, and opted to kick a field goal on 4th down. So that means that they had to kick the field goal, recover an onside kick, score, and get a 2-pt conversion. So they recovered the kick. I was ok with that. The real issue came on a 4th and long (around 8 or so). They threw a 30yd pass that the receiver caught out of bounds. There was no question, even before the replay, that he only got one foot down. It wasn't even a sideline catch animation. I challenged and lost, which put them on my side of the field with about 2 minutes left. I ended up losing the game in OT after fumbling on the opening drive, but it shouldn't even have gotten that far.
Anyway, hopefully they can make the challenge system realistic on the new systems. It's a huge part of the game.