Does the setuid mechanism actually work?

Unless I'm missing something (and that is certainly the most likely 
situation), the setuid trick on the LNX-BBC depends upon the setuid bit 
of the setuid-wrapper script being respected and this seems not to be 
the case. As a result the "setuid" programs in /setuid/bin/ actually run 
  as the user, not necessarily root.

Is this a known issue? Is there a fix? (Searches of the bug database are 
not currently working so I cannot try to answer my own questions.)

g.