Sequences won't roll over by default. nextval() fails if you're out of values. You can create a sequence which is allowed to roll over (by specifying cycle), but it's not the default.
Yes. It's not optimal and you can shoot yourself in the foot, but it works in its default configuration. I just gave a workable workaround for a problem, I wasn't saying it's the perfect solution (a working unique constraint on the parent table would be)
