For the most part, yes. I don't know about the newer SM disc set, but the older ones had a TOC limit--somewhere around 4.35 GB. In other words , you can't use it on full single layer discs (4.37GB) or dual layer discs (up to 8.5GB). For those you would have to use a GameShark or Action Replay and let a normal disc change (no bypass device) spin up a normal disc that was larger than your backup disc, and then use a bypassed disc change to swap in your backup, then boot the game. A real pain in the arse, and can risk damage to your drive mechanics and discs if you frequently play large games via backup.
In all honesty, for the cost (about $25) vs. the headache and stability of the machine, you'd be better off spending just a bit more to get a quality modchip. I haven't followed the development in quite a while, but I think the clip systems have come a long way so you don't have the tricky soldering to do anymore. Of course, you could send it to any of a dozen or more users here who could do a quality soldered solution for a reasonable price.
Trust me, you will be much happier with a truely chipped solution!
A lot of stores have dropped the mods due to some changes in the legal scene, but you might still find some info/chips at these places:
mrmodchip.com
consoleweb.com
china-magic.com
ps2modchip.com
(I know, these are really old, but they stilll have some stuff. Anyone please feel free to add newer sites if you want)
BTW, is the Magic camp still putting out a viable product these days?
Raist