Yes, quite correct Ray, it does make a difference in damping out the soundboard etc.
In addition to this there are some players who hold the guitar quite close and "choke" the resonance of the back (classical players I believe have known about this for years I believe). Tim McKnight has developed his "hollowback" concept which essentially is a double back with bracing in between the two pieces. This allows the inner back to resonate/float quite freely and be unaffected by the players body (or belly ?). An additional benefit is that one could use a more decorative piece of wood for the back and sides and the actual tone wood for the inner back and sides. I know Tim has made a quite beautiful Birdseye/quilted Hollowback Maple SJ guitar with rosewood inner back and sides which will result in a rosewood tone rather than the bright maple tone.
He is currently building another in the same woods I think - see build thread here:
http://www.acousticguitarforum.com/forums/showthread.php?t=192880
The description on Tim's website as well which explains everything in great detail:
http://www.mcknightguitars.com/process.html