You are right, you can go all out and risk a loss, but I believe the risk/reward analysis favors not going all out when you have 9 on the field, especially when you know a tie keeps your chances alive and a loss eliminates you from the tourney.
Probably right, but you're also assuming that sitting back ensures that you don't give up a goal. The odds are well stacked against being able to hold out for 45 minutes against Italy without conceding anything.