We directly investigate both experimentally and numerically the influence of optical nonlinear loss dynamics on a silicon waveguide based all-optical device. The dynamics of these nonlinear losses are explored through the analysis of optical limiting of an amplitude distorted 10 Gbit/s signal in a slow-light silicon photonic crystal waveguide. As the frequency of the distortion approaches the free-carrier recombination rate, free-carrier absorption reaches a steady state, leaving two-photon absorption the dominant dynamic nonlinear loss. Our results highlight the importance of engineering the free-carrier lifetime in silicon waveguides for high speed all-optical processing applications.