Yes, that's correct. That's also called an "Automatic" transmission. If I wanted it to automatically select another gear for me, I wouldn't put it in manual mode. If I'm not hurting the engine, and I give the car a little gas (I stress "a little"), in manual mode, the car should not downshift. Ever. Manual mode is not solely for "performance", it's to have full control over shifting the transmission. I serioulsy doubt Audi's DSG would do that.
Never mind.