"Content selection mode" seems to have no effect

Maybe I'm misunderstanding what the "content selection mode" is supposed to do, but it seems to be having no effect at all.

I am running a website whereby some of the pages are available in both English and Welsh and others are only available in English. The site's default language is set to English and the content selection mode is set to "Mixed current language (if available) or default language (if not) and language neutral."

If I go to the site's home page (which is bilingual), I am presented with the English page (?q=home) and there is a link to the Welsh version (?q=cy/home) at the bottom. If I go to the Welsh version of the page, all the Welsh primary links become visible and the English primary links disappear, including the links that have no Welsh translation. Similarly, pointing my browser at ?q=cy/foo where "foo" is only available in English gives me a 404, whereas I would've expected it to fall back to the English version of the page.

Even setting the content selection mode to "All content. No language conditions apply." has no effect - I would've expected the primary links for all languages to appear, but still only the English ones appear when in English mode and only the Welsh ones appear in Welsh mode.

So, what am I missing?