That is true, but that's not what I'd call a morale boost - I thought Necurok meant the units already in battle get additional morale, which doesn't seem to be the case. It's just fresh units coming in with higher morale.
You are right, though, that the morale of units in the second row takes some damage, so sending in useless troops is indeed not a good idea; I'm not sure if this also applies to troops in battle that aren't deployed. Additional troops may also block artillery from being deployed over the complete combat width. So it's better to cycle in troops in the early game, but at some point in a I usually stop bothering with that much micro.