Sorry to be a bbit pedantic about this. But you mean that that umask is used when the hoem directory is created? Thus usseradd does:
umask <that-mask>
mkdir /home/<new-user>
(or the equivalent in system calls).
This value is thus used only one time for every user. Well after rereading the YaST explanation (in English, I first did it in Dutch), I think this is correct.
And your explanation in the SDB is very clear now. Thank you for that.
As far as I know, “login” is PAM aware, and a user session inherits the default umask from login. So the PAM setting establishes a default for users who don’t define their own “umask”.
Personally, I set “umask 022” in my profile, in the unix spirit of sharing. Of course, I do have some files and directories that are more restrictive.