Yes you are bang on. They limit the movement so you don't crash into the end stops.
A lot of the cheaper builds don't use them as a cost cutting exercise and just rely on the operator making sure his work envelope stays with the limits.
Not to bad on small machines as they usually just stall and loose position.
The larger industrial servo machines can do serious damage if they hit the end.
I have seen heads ripped off laser cutters when they have gone walkabout.

Three options and combinations of :-
[1] Don't bother and try to stay within limits
[2] Fit switches and wire up.
[3] Mach 3 has what are known as "Soft Limits" These are software limit switches that tell the program you can only go xx in that direction. You do need to set these from job to job as they only run from 0.0.

My router which is a Techo Isel bridge router was bought S/H with no motors or mounts fitted but it did have the nessesary linear rails and ball screws. This had crude limit switches which I ripped off as they were broken and bent.
At the moment it has no switches but I recently bought 3 reed switches and 6 magnets from RS as fitted to door and window alarms, very cheap about £1.50 a part and only accurate to about 3 to 5mm but as I don't need to home, only act as a limit I think they will work OK.
One switch per axis and a magnet at either end of the travels. Cuts wiring down and will look neat but time and testing will tell.

John S.

[edit] Not sure what's happening here but the * should read f-i-t-t-e-d somehow the software doesn't like that word ?