Partly true, but being an instructor forces you to take decisions on the weather, how to teach a manouvre, etc, it gives you much more confidence at flying.
Sure, the first 200 hours of teaching are pretty nerve-wracking, but once you pass that you cease to be 'all over the controls' and constantly nervous, and you soon tire of the local area and are desparate to explore other areas.
I think being an instructor is a great 'grounding' for a flying career, you learn lots about flying and lots about the industry.