You've nailed it. The pre-load setting alters only the ride height. You want the suspension to sag by about a third of its total travel (i.e. from topped out) when you are sitting on the bike ("experts" differ on the ideal amount) . That puts the suspension in the optimum place to respond to bumps and dips in the road. The pre-load setting is there to set the amount of sag.
If you've got short legs, like I have, you may find the seat height a bit high for comfort, so you can wind down the pre-load (i.e. increase the sag) a bit more, to maybe half the total travel, but be aware