I have known one woman who used it with her 3rd pregnancy, and she did still tear during her birth (it was a planned unassisted homebirth).
I think that the best tear prevention is the ability to move into birthing positions that feel right, not having care providers hands "down there" while baby is crowning, good prenatal nutrition, kegels, and waterbirth seems to also help.
But, at the same time, I think that our bodies' way of preventing those horrendous 3rd and 4th degree tears (which seem to so often follow episiotomies btw
: ) is by giving (tearing) little bits here and there (skid marks and 1st degree tears). The vaginal and perineal tissues heal so well the majority of the time.