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Well, yes, you will get a sync signal because the OSSC can read the sync signal from composite and luma; it just can’t interpret those formats’ video signals.
RGB over SCART often uses composite video as the sync signal, and composite, luma, and clean composite sync are all transmitted over the same wire. So when you connect your S-Video source, luma is being placed on the sync line, and the OSSC is getting sync, but there’s no usable RGB data on the R, G, or B lines, so you won’t get an image.
If your only concern is your GameCube, I’d save up and get a GCDual installed. If you have other consoles to use it with, get the RT2X.