Yes, I've seen this. I recall, we had situations with, say, 12 processes in a deadlock. SQL Server selected one as a deadlock victim. Which left 11 processes deadlocked and so on.
It kind of make sense. With some luck, the deadlock will be really resolved. when you take out one of the players But there can also be other complications. Maybe there is some other processes that was blocked by the deadlock victim, but not part of the deadlock. That process can now proceed - but only to be entangled into that deadlock.
Note that if you have multiple deadlocks that are independent of each other, SQL Server on each round will kill one process in each deadlock.
Also, I believe that SQL Server may decrease that five-second interval if there are plenty of deadlocks and check for deadlocks more often. But when we had our 12-process deadlocks, that did not happen.