Exactly. However, powering down would be unlikely, as the rewards from curating, self-voting, and etc. aren't necessarily SP. Since delegations aren't gifts of Steem, powering down would not enable delegates to sell their delegations. In order to profit from them financially, they would need to keep them powered up.
It would be trivial to use an algorithm to detect profiteering by delegates and trigger withdrawal of delegations. Delegations that remained in effect would be those that were curating such that stake was being distributed to users meriting it. Merit would be impossible to ascertain with an algorithm, and that's why delegating stake to users is necessary.