We have to distinguish here between two different locations of the dissipating resistor. In one case, the resistor is connects between the plus and minus DC bus of a drive in series with some kind of control switch, usually a power transistor. In my experience, this is usually called a shunt resistor and circuit.
When the DC bus voltage exceeds a threshold, the switch is closed, allowing bus power to be dissipated through the resistor. Yes, this protects the power circuitry from being damaged due to overvoltage conditions, but having this protection permits aggressive deceleration that would otherwise destroy the power circuitry.
Operating the drive and motor to engage this shunt circuitry is often part of normal operation of the motor/drive system. It is used in control of DC motors, synchronous AC motors (including "brushless DC" motors), and AC induction motors (especially under vector control), functioning in fundamentally the same way for all types of motors.
The other location for dissipating resistors is between the leads of the motor armature. (For a 3-phase motor, you will have 3 resistors connected in Y or Delta.) In this configuration, a relay for each motor lead can switch the lead from being connected to a drive output to an end of the resistor.
This is really an "emergency stop" circuit. In a stop condition, the motor is automatically disconnected from the drive and connected to the load resistors, which help decelerate the motor more quickly due to their loading of the motor acting as a generator. This is quite commonly used for DC motors and synchronous AC motors.
It is a bit more problematic for AC induction motors, because it works only when the field is present. In an AC induction motor, once the motor is disconnected from the drive, the rotor field will decay quite quickly, and with it, the braking effect. For this reason, I am unfamiliar with its use on AC induction motors, but perhaps others here have different experience.
Curt Wilson
Delta Tau Data Systems