This is a feature, which does not work at all on my company-managed Win10 Lenovo laptop.
In my experience it has worked flawlessly without any manual setup (aside from changing bios sleep mode setting to linux). Worked for my ThinkPad and it has also worked for my older lenovo about two years ago.
If you don't have an external screen connected, yes. If you do, it just counts it as if you've disconnected laptop's monitor.
But of course, your mileage may wary on the hardware.
I believe it's mostly fixed nowadays. I remember fixing this on Ubuntu like 10 years ago by adding an "acpi=off" in the grub config file.
I have yet to get that reliable working on any Linux laptop of mine.
Maybe I am closing it wrong or something.
Works fine for me, XPS 15 running Ubuntu 20.04.
Was this ever a problem? I haven't used a laptop where that wasn't the default.