Yes, that is the actual instructions that they give.
Imagine a relative of yours who is much less computer savvy than you are. What are the chances that the actually enter their real password?
And what value is this check, actually, on a fake password. "Your fake password will take xxx centuries to crack". So how does the non-tech savvy person, who might have a struggle coming up with a real, useful password, then enter one that is similar but not exact and expect a measured response?
So even if they collect "simulated" passwords, password cracking is less about entropy and more about generating dictionaries based on patterns that users are likely to use.
There isn't any value in such a site, and I claim it is less than useful.
Ok... 10,000^4 * 10 = 100,000,000,000,000,000 @1,000,000,000,000 passes per second (nsa level bruting) = 27 hours to break one single password. There's far more low hanging fruit in an encrypted list of passwords than to bother with random common word combos. Unless you're a specific target, it's not lucrative to a hacker to use brute forcing to get through the last 10 or 20% of users with good passwords.
> Seriously?
Sample passwords, not your actual passwords.
If you follow that link, they reinforce that with: "Never enter your real password".