"...indicating that the function takes preference to a variable assigned by assignin to the parent function scope?"
Yes.
For good reason: because that is more efficient for the JIT engine. If the JIT engine always had to keep looking for magically created variables (e.g. that shadow functions, as your example does) and then when it finds them it would have to replace whatever it had already compiled with something entirely new and compile everything again, then clearly this would slow things down considerably.
This topic has been discussed plenty of times before:
Summary: passing data using the recommended methods is more efficient and less buggy than magically creating variables.
