No, your understanding is not correct. While Apache Spark 3.0.0 introduced zstd compression support, Databricks Runtime (DBR) 7.3 LTS, which includes Spark 3.0.1, does not officially support using zstd compression for Parquet files on the Databricks platform. The official Databricks release notes and documentation clearly indicate that native zstd Parquet compression support starts from DBR 8.0 and above. Using zstd compression on DBR 7.3 LTS can lead to compatibility issues such as job failures or unreadable files.

For official confirmation, see the Databricks Runtime release notes and support details here:
https://docs.databricks.com/aws/en/release-notes/runtime/

So, it is important to upgrade your DBR clusters to version 8.0 or later before adopting zstd compression for Parquet