I'd check with Garmin on that - something doesn't sound right. Fortunately I've never had a situation to truly test it, but I can't imagine my Garmin deleting the activity.

A friend of mine crashed during a group ride a few weeks ago, and I stopped his Garmin manually later. But I don't know if he had the crash detection and alert set up; it would have triggered long before any of us thought of it. I don't recall hearing his phone's alarm sound that mine makes when I trigger it, so he probably doesn't have it set up.