Frequently that is what it means, and that is pretty much always how it is taken. But then it is in the review industries interest to take it that way.
But I don't think it is quite that simple. Sometimes I think they just feel that, even if they have a good movie, press reaction can't really do anything to help them. The people who are going to go on opening weekend were going to go anyway even if the reviews are good and so all reviews could do it possibly convince some people to not go (even the best movies have bad reviews). By the second weekend press reviews are almost completely irrelevant since everybody is then mostly relying on word of mouth from people they know personally who have seen it.
Then you also have the fact that different individual personalities running publicity simply like different levels of control or have certain strategies in mind.
For example, my screening invite for
Milk includes this line and I don't think there is anyone doubting the quality of the movie:
Quote:
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And lastly, we request your cooperation in not running/posting your reviews prior to Wednesday, November 26, 2008.
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As for the number of screenings, I don't know if that is at all a reliable indicator of quality. I've seen great movies that only had one screening in the entire Bay Area and awful movies that have had four screenings each in five different towns. I think this is more a product of the marketing budget than the movie quality.
All of which isn't to say that Twilight doesn't suck and that the attempted embargo isn't a sign of that. It may. I just don't think it is a universal sign of that. Refusing to hold press screenings at all is probably a better indicator of real suck (though that has also increased in the last couple years into less sucky territory).