Chris,
As I understand the DeviceAdPreference, the wording in that documentation is misleading. The way it is written sounds like the flag indicates that the ad prefers mobile devices, when it would be more accurate but a bit abstract to say that mobile devices prefer the Mobile Preferred ads.
I believe this is what they meant to say:
"Marking ads as Mobile Preferred tells the serving system that those ads are favored on mobile devices."
I believe that there is still nothing to tell you that the ads will only appear on mobile devices, but that the system will give preference to the Mobile Preferred ads when serving ads to mobile devices and that the system will still try to serve ads that are not Mobile Preferred if the Mobile Preferred ads are not performing well. I am pretty sure that the system always tries to serve the best performing ad for a situation, this feature gives you a way to tell the system you prefer this ad over others for mobile.
Hope this helps, and is still a correct understanding of the feature.
Jason