Not actually how it works. There’s two options. One of them has the notifications in the “dead space”, but the content never gets eaten up.

Image showing what was described

(Pinging @EdibleFriend@lemmy.world , just in case you didn’t know about this!)

I wouldn’t use this myself. Most apps are designed so content fits underneath the camera hole so nothing gets eaten, and even if it does get eaten, the camera is so small that it’s not an issue for me