If the microphone is outside of your helmet it will sense the noise there and apply cancellation for it. You will hear that as a partial reduction in the total noise level. Noise cancellation works by applying sound waves of the same frequency, but opposite polarity from the source. The effect, when it works, is to cancel the physical sound pressure waves before they reach your ear drum. The hazard is that if the correction is applied incorrectly you are potentially increasing the total sound pressure reaching the eardrum.
The problem for this application is that the noise from outside the helmet is not what primarily causes hearing damage. Noise from outside the helmet is already well attenuated by the helmet, padding, etc. The greater amount of damage for helmet wearers is done by the booming low frequency noise that results from wind hitting the helmet shell, and being introduced into the helmet at the open bottom. The amount of this noise will be affected by many variables; the helmet design, windshield height and shape, your torso height, and how much your noggin sticks up into that turbulent wind.
Because that noise is generated inside of the helmet the microphone outside doesnt know about it and cant help cancel it. The best way to reduce this noise is to either prevent it from happening, or to wear highly attenuating ear plugs that will reduce the noise to safe levels. In Ear monitors typically do not reduce the noise level enough.
Everyones tolerance of noise level varies. I have friends that never wear any hearing protection and claim they have no problem. I have constant tinnitus already and am only comfortable with 30 dB or greater attenuating plugs.
Your mileage may vary. They are your ears and you should do whatever you feel comfortable exposing them to. Just be aware that once the ringing starts for real, it never stops.
As for the ERA, well, that is an entirely different type of painful noise.