Yes, that's the issue. If the silt layer is thin (maybe up to 1 column diameter thick), they probably work great as shear reinforcement, and can be analyzed by a simple area-replacement ratio (allowing for some edge effects, possibly including intrusion of excess PWP or liquefied silt).
If the layer is thick compared to the column diameter, the columns become slender elements in bending, and have to be analyzed as such. The material has no tensile strength, so the bending stress on the tension face of the "beam" can't exceed the effective overburden stress. It would be an exaggeration to say that they don't work, but their benefit decreases with slenderness, and the analysis gets a lot trickier.
The bending issue applies to jet-grout and soil-mix columns as well. Guney Olgun, Jim Mitchell, and others at Va. Tech had written a paper about a jet-grouted site in Turkey, concluding that the JG columns had stiffened the foundation and prevented the problems that occurred at an adjacent area in the Kocaeli EQ. Subsequently, Guney and Jim Martin(?) reanalyzed it with FEM and concluded that they did not actually help so much. He presented that at a conference I went to sometime in the last few years, maybe the SFO EQ 100th anniversary conference in 2006. I've got a paper somewhere, but I think it's in a pile of stuff that I lent out. If you're interested, I'll see if I can track it down.
DRG