SET can assign NULL as the new value in this finite model.
SET to NULL
Set note to NULL
The statement has 1 NULL assignment and changes 1 cell.
NULL assignments=1
UPDATE examples are tiny finite row modifications; SQL dialect completeness, joins in UPDATE, subqueries, triggers, constraints, transactions, locks, indexes, optimizer behavior, performance, and product behavior are out of scope.
Read the output
The note cell becomes NULL because NULL was explicitly assigned.
NULL visible
Summary
This is a cell value, not a request for a default.