What she has deducted about children is true. Just because a child can't yet speak the language does not mean that they don't comprehend. Even an adult when learning a language can understand short verbal commands before responding verbally. If you say to your young child, ‘no, don't touch!’ consistently while at the same time doing something that will reinforce what you are saying, your child will connect your language in their minds. They do understand.
I had this conversation with a friend once who was convinced her one year old didn't understand. So, we did an experiment with her. We put the child on one side of the room with her back to us. Then I had her mother call her name and ask her to come to Mommy. Surprise, surprise, the child acknowledged her name by turning to her mother, and responded to her invitation by crawling to her! Children understand you early on. The sooner you begin to recognise it and to say, ‘no don't touch!’ or call their name saying good girl/ boy the quicker you are going to see obedience in your children. Your children do understand but they don't always respond in an appropriate manner. It's not that they didn't hear you, or that they don't understand, for it is called self-will.
Children are born innocent and loving. However, they do have a will and the notion that the world revolves around them. We were at a wedding recently and sat near a family of three. While we observed the children I noticed how complacent the baby was. The parents were busy with the two older siblings and the baby sat very contentedly. That child learned very early on that the world was not all about her.
Children do understand and they understand early. If you speak to them in clear short commands keeping your vocal tone matching what you are trying to communicate with a readiness to put action to your words, they will understand and respond while they are very young. Yes, it is work for you but it is less work when they are young then when they are older. Your children do understand you. Don't be lulled into the thinking they are too little.
(image courtesy of Free Digital Photo.net