It would pretty much have to. But the point is, despite how it's portrayed in the visual medium of television, the important part of cloaking a ship isn't invisibility to the eye. So other forms of invisibility, like holographic isolation suits, are a different matter.
Really, if you think about it, basic invisibility is integral to holodeck/suite technology. A holosimulation involves concealing the walls, floor, and ceiling of the chamber, and often involves creating the illusion that people who are actually standing within a few meters of each other are much further apart or even unseen by one another due to intervening structures. For instance, if you enter a holographic Baker Street, climb the steps to 221B, knock on the door, and are allowed in to find Data Holmes and Geordi Watson within, you don't see them until you get to that part of the simulated environment, but in reality, they've been in the same smallish room with you the whole time. What is that if not invisibility?