Not totally true.
Artist's oils are quite often used to paint figures. They typically have to be prepared with a primer so that you are not painting over raw plastic. The oils allow blending and shading of skin tones and shadows on folds on clothing. Oil painting figures is a skill which takes practice to master, but once learned is a great asset.
Artist's oil paints are also a fantastic tool for detailing models. A thin wash of oil paint in a mild thinner (eg Turpenoid) adds shadows and depth. Paynes Gray is an excellent choice for shadows (go outside and look at your house -- the shadows are gray - not black). Other choices are raw and burnt umber. They make good rust washes, or flowed along and in planking on ships to eliminate the monotone color. I've even used a royal purple around the hatch & gun mechanism details on WWII ships painted in USN WWII Haze Gray.
Oil painting is a tool which most good modelers have somewhere in their bag of tricks.