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Yep, pretty much. I've had this happen to me as well. I think it's partially so they have candidates as back up, and partially so they can find out how hard you want to negotiate salary and go with the candidate with the lowest ask.
It's possible they're keeping you warming up in the bullpen just in case the starter they've chosen has some problem. It happens. Companies don't want to go through the process and be caught without someone if something goes wrong. It might seem unfair or rude if it seems you're in the backup position, but, hey, that's just business.
A lot of companies do keep a couple of finalists in play until the offer is signed. It is not always about you being a backup, sometimes it is about risk management. If their first choice drops out, they do not want to start from scratch.