Your are correct. The Tjunction is the maximum temperature a processor will reach before it shuts itself down. The correct temperature of a processor can be between 30c to 78c depending on the workload but if it goes higher it is necessary to check the airflow in the case, thermal paste, Cooling solution correctly setup, etc…
In regards the Intel® Turbo Boost, I meant to say that it will be activated depending on a combination of several things such as voltage, temperature, workload, etc… but it depends on the processor model (not all of them are the same).
Here you have a link that shows an example of how Intel® Turbo Boost works in Intel® Core i5 processors (very similar with Intel(r) Core i7):
http://www.intel.com/support/processors/corei5/sb/CS-032278.htm