[MT-ED]

Back in the 70's British Leyland produced a batch of cars with shorter than spec dipsticks. Therefore each engine when filled to the dipstick level was in fact overfilled. These cars were delivered and driven around without issue...........UNTIL, the owners took them onto the Highway for the first time and drove at sustained high speeds.

As kevster stated, the crank dipping in the oil caused it to froth, oil pressure was lost and the bearings went kapow. Breakdown trucks were baffled because by the time they arrived the oil had reconstituted more solid and the dipstick level was apparently correct. If the engine wasn't seized and would start, even the oil pressure light went out, making everything appear to be normal.

Yes, correct level is important.