RLM Processing Rules @ Item Level

I have a client that has item level processing rules for select items.  My understanding is that the Demand Processing logic works from the bottom up and looks at the Item Level Rules first for a specific Ship From - Ship To Customer and Address.  If it finds an item level rule it will process the demand based on the Processing Rules for that specific item.  If not item level rule exists then the DP looks at the Address Rule.  Since all remaining items would fall under the Address Rule then by default the DP would use the Address Rules,