The Fokker 50 has the same IAS mode and it is indeed only used for climbing and descending. With ALT hold activated pushing the IAS or VS mode cancels ALT hold and the A/P reverts to basic pitch mode. The aircraft would most likely leave its altitude to maintain airspeed which results in an altitude alert.
Using IAS mode in the F50 works in smooth air but other than that the aircraft will oscilate chasing the selected airspeed.
We are taught to use IAS mode to maintain vFTO in a single engine situation as it is critical to maintain the speed precisely.