That's exactly what I observed twice a couple of weeks ago. About 30 minutes prior on the first night we picked a spot standing on the curb at the end of Main Street right outside the Plaza Ice Cream Parlor, outside of the rope they had strung to keep traffic moving on the sidewalk.
Five minutes before the show as CM's were telling people to clear the sidewalks and keep moving, people simply dove under the rope and stood next to us. They continued to pack themselves in this way.
One family refused to move off the sidewalk (right at the corner outside Plaza Ice Cream). A CM told them multiple times that they had to move. They refused. Every time the CM told them they had to move, they said no. Eventually security came over, looked around, and moved on. Several more families joined that family on the corner.
When the show started, two families in front of us who had packed themselves in under the rope put their kids on their shoulders. We now had an almost 8 foot high wall of bodies in front of us and couldn't see a thing.
The second night they announced over the PA system that "Main Street has reached capacity for tonights show, please continue on to other areas of the park". Of course, nobody did. And that night was simply a repeat of the first night.
Evening fireworks at Epcot? A much better experience in my opinion.