Yes this is the way to use LR Mobile.
The photos from your device are stored in a system generated folder. You should also see them in Collections. If you select (highlight) a thumbnail in a sync’d collection it is possible to look in the metadata panel for the file path. The folder names usually have a strange string of numbers or letters but if click the right pointing arrow you will be taken to the folder on your computer OS. So these images will always remain on your computer and within LR desktop even if you delete the jpegs from your device.
If you find the system generated folders confusing, you can specify a named folder or choose to create sub-folders by capture date. You do that in prefs. Go to:
Edit >> Preferences >> Lightroom Mobile (tab) on Windows
Lightroom >> Preferences >> Lightroom Mobile (tab) on Mac
You may be interested in updates to mobile on iOS devices that have been released enabling editing from Camera Roll. Go to this link:
Thanks very much for the confirmation and the additional information, particularly about how to get Lightroom Mobile to store its photos somewhere "normal". I'm feeling much better about using the service now!