> Screens can't often do full brightness on the whole screen so if you come across a video or image that is supposed to have a higher contrast ratio, the system will darken everything and then brighten up the pixels that are supposed to be brighter.

There's no system that does that. The only thing that's kinda similar is at the display level there's a concept known as the "window size" since many displays cannot show peak brightness across the entire display. If you've ever seen brightness talked about in context of a "5%" or "10%" window size, this is what it means - the brightness the display can do when only 5% of the display is max-white, and the rest is black.

But outside of fullscreen this doesn't tend to be much of any issue in practice, and it depends on the display.