Correct. The reason is that bees seem to find it hard to draw nice comb when the frame is up against the wall. If you put the new frame between 2 existing good frames, they are less likely to build crazy comb.
It suggests to me that they were building for drones. They may still use it for honey or pollen, but if the queen finds it, she will be putting drones in it. Early in the season, I would rather have brood or workers, which means that it would probably be better to give them fresh frames.
You need to fix that frame too. You really can’t let them do that - you can’t inspect it properly. I know it may mean killing larvae, but it is far better to fix it early in the season, when they have time to recover. If one of the double combs is centered in the frame, just try to cut the other comb away from it. If they are both off center, I would cut out both combs, separate them, then rubber band the comb as a single layer back into a frame or two.
Some people do that, I don’t do it routinely. If I see a very crowded brood box, or beginnings of swarm preparations, I will make a split into a nucleus, and put some empty frames in place of the 2-4 frames or so that I have removed (placing them in positions 2 and 7 preferentially, as you noted above). If you have more than one hive, you can also use the removed brood to boost any hives which are off to a slow start. Some good advice on swarm prevention here: