It's actually meant to work like you describe. The documentation is built as a mobile website, with "allow off-line use" local caching flags checked (in Dashcode).
However, the feature doesn't seem to work as expected. I would have thought that "allow off-line use" allows you to use the documentation without an Internet connection. This is likely a Dashcode/UIWebView issue and a bit outside my control. I could, however, accept that this is broken and have an extra local static copy of the documentation that will be used if there's no Internet, and simply side-step the not-working caching functionality.
Thanks for the reminder, I'm working on a long-overdue update and will give this another look. I agree it's important.