I believe it goes the other way. It won't let you down shift to overrev (which is where the real danger to the engine is, as any good race car driver will tell you) but it will let you hold a gear at the top. That's how it appeared to work on my test drives. The Lexus IS300 shifted at the top for you...I found it really annoying because it defeats the purpose of enabling the driver to control the shifts.

Hitting the rev limiter won't damage your engine, although maintaining your concentration next time is probably a good idea.

-dwf