You've got the idea. Define CloudForamtion templates as you normally
would, defining all of your AWS resources, but leaving out the
configuration of the servers. Use Ansible to launch the template and let
Ansible configure your servers after the CloudFormation stack is created.
When that module was created, the Ansible cloud modules weren't nearly as
fleshed out as they are now, so the only way to easily provision some
resources was through CloudFormation. That is still the case with some
things -- NetworkACL's comes to mind.
It's also useful for folks who are transitioning from CloudFormation to
Ansible.