This explanation is wrong. The IsNull function converts to the type of the check_expression, which may involve truncation. It's nonsense to talk about truncating to the length of an expression whose value is null because that length is null. The length of left(null,5) is not 5, it is null.

What is interesting here is that left(X,5) delivers an expression of type varchar(5), not an expression of the same type as X. I haven't seen that documented anywhere, and I'm flabbergasted by it. Needless to say I got the wrong answer, and I've learnt this crazy behaviour of Left from it. I guess that makes it a good question - anything that makes me learn is good from my point of view.

edit: spelling errors