Some Spektrum receivers only failsafe the throttle channel. You need to check your receiver specifications. You can also check by plugging in a servo, turning your switch to the cutoff enable position and then turn off your transmitter to see if the servo does a full rotation indicating it went to the failsafe position.
I'm using channel 7 (a toggle switch) AR8000 - Have set the ATV on that channel to +/-150% - Bound to transmitter with that channel off and throttle at idle - The ignition cuttoff works fine BUT when I turn off the transmitter the throttle returns to idle the ignition remains on. Shouldn't it turn off becase of the AR8000's failsafe?? The cutoff is part of an EQ6...