Right? I hadn't heard of this particular anecdote but it sounds plausible.
Look, there's a kind of player who're basically Storyteller jocks. With them it's all about the things they can do to others, the monsters with big stats they created or the gross things they threw at the PCs. They brag about it, too ("so the spirit had 15 dice and it negates defense, AGGRO! Hahaha!") like it's a mark of pride.
I was lucky enough to not be that familiar with the practice until some time on TR when I was invited to some plots which literally started before +inits were rolled; like, we'd start in front of a house where Things Had Happened (how did we get there? who are the other characters? why is my PC with them?), then the bad guys spot the party and they attack. I think at this point since there's nothing else to take pride in - I mean it's not like it'll get marks for creativity or development - the Storyteller just goes overboard with stats and grossness of guts and innards hanging from walls, or giant bloodshot eyeballs with teeth and whatnot doing the attacking.
So it's possible those people @Coin is talking about add NPC casualties in the same list - which is lazy more than anything. If you're worth your salt at all you don't need to go kill the characters' Best Friend merit NPC if you want to create an emotional impact; instead buckle up and use your keyboard to type things which amount to an NPC of your own who's interesting and cool enough for them to care about them. Give them a sense of purpose, generate ties with the party, create rapport, breathe life into them... then butcher the living fuck out of that fucker. Then enjoy the players' hearts breaking and relish in the taste of their tears.
Or, you know, whatever.