And I suppose when encountering them (since they were culled not truly removed) switching to a backup collision avoidance mechanism or replanning?
After the initial graph search, the path is modified to avoid these obstacles locally (by pushing the path around the obstacles, essentially), before it's returned from the pathfinding query.
So the way it's set up in PathEngine this optimisation is largely hidden from application code (code that calls into the pathfinding API).
Leaving this to be handled later on, by agent local obstacle avoidance, could also work..