Your understanding is reasonable.
There are two different penalties. There is an individual player penalty, which kicks in if they've exceeded a value that is a combination of their individual possessions per 82 games and their possessions per minute.
The other penalty comes into play if you don't have enough Usage% on the court at a particular time. We basically assign points to each of the 5 players based on their Usage%, and if the sum is under a certain level then a penalty applies based on how far under you are. So you could avoid the penalty by having one or two high volume guys with some role players, or by having a balance of middle volume guys.
bumped from the possession penalty thread... which in itself is an amazing thread that all new players should be required to read just so that they understand how badly seble sucks and why some of us are so grumpy when it comes to the sim's staff not giving a ****.