Yes, it tells. There is no need to fake anything.
When your car in real life starts to slide it's the rear tires, not front that loose grip and make the back of the car go sideways.. Front tires have grip. So, front tires keeps their direction while rear slides out. The car goes sideways, front tyres holds nicely and it's the body that sort of rotates around front geometry, forcing steering wheel to turn.
If you have LEGO Technics then build a simple car with a steering rack. When done, grab both front tyres with your one hand and keep them steady. With your second hand, grab rear of the car and move it sideways. Steering wheel will move in a countersteering manner. That's exactly what happens when you start to oversteer a real car... and how it should be in our simulators.
oversteer and understeer are such simple terms lol, we need more than just the front ploughin like a pig or the back end swinging around, we need all the little feelings you get from your body in the car, we get these feelings in real life much before we feel them in the wheel and before we even recieve them as visual cues, and I would say that 75% of feeling the car comes from this. If all we had was an exact replica of the steering rack yes it would feel the realist in term of steering of course, but in terms of getting a feedback from the car, riding the limits of grip every lap, feeling the tiny changes grip changes, slides, skips, hops etc that affect your laptimes by even a tenth or half a tenth, than no way, sorry but pure 100% steering rack wont do. Go race a foruma ford 1600, ff2000, 450+hp bmw engined prototype, im not trying to brag, I hate when it comes off as that but if I just went by steering and visual cues I would loose id say around 75% of the overal car feeling, and I would either be dead, would have been slower and/or alot less consistent, (EVEN MORE SO IN THE RAIN).
Theres 2 sides to the simracing ffb, the ones that want pure steering rack without making up for most of the feelings we get through our body (whch is ALOT more feeling than we get from the wheel and visual cues by the way), and then theres the ones that want to take advantage of the ffb to make up for some of the feelings we miss out on (which again is most of the feeling). In terms of steering (and thats what we are doing after all) I agree, of course option 1 is the most realistic. I prefer option 2 though. as when I used to race, it would feel the most natural because the g force and grip info we got from the sims through the ffb would, yes, translate to my body instead of my hands, BUT my brain cant tell the difference wether its from the steering or my underside so it would feel alot more similiar to the game than just a pure steering rack. Now if we analysied the steering rack on its own again of course option 1 is by far the most realistic, but option 2 in my oppinion gives you some of the feelings your missing out on in real life, and again when you hop back in real life, with me atleast, my brain felt more similarities with option 2 because my brain was getting more of the feelings of the car vs just pure steering rack. my brain didnt care that the feelings were on my my backside and butt instead of the wheel, it was still processing those feelings regardless.