You are correct on both counts.
The idea is that you give the grain just the slightest misting some time before milling. It softens the grain so you get more crush, less shatter. When done properly the kernel pops out of the husk nice and crushed, and the husk remains mostly intact and ready to act as a nice, slow filter medium for sparging.
I tried it once, did just a bit too much misting, and spent the next couple hours tearing down the mill to wire-brush all the dough out.
But done properly, it’s a legit technique, just not something I care to do. — I BIAB so I think “extra crush” does more for me than spritz crush could.