The corrections with the algorithm are always done at an “infinite” color depth. In other words the rgb values are always converted to a double with range 0 to 1 for both the source and the reference. Although I agree that in some cases “stressed” color may be a problem, especially with color crush, blown out colors, and compressed images, I believe in the example you posted, you may have actually smoothed skin texture reconstructed by the color correction algorithm. The downside to every smoother, is that you always sacrifice detail for smoothness, although some definitely work better than others.