Please check if my understanding about close up filters is correct.
The main principle of the close up work is to have enough extension between the lens and focal plane. The length needed depends on the focal length of the lens - for 1:1 macro the distance between the object and optical center and between focal plane and optical center must equal to twice the focal length.
Lenses with integrated focusing system have limited extension and can't therefore focus close.
Close up filters work by reducing the focal length of the lens. This reduces the required extension and this allows to use the same lens extension to focus closer and therefore get higher magnification.
Yes, you have it right.
One person pointed out that strictly speaking they are lenses, not filters, but they are screwed into the filter threads of a lens, which means they are used sort of like filters, so we sometimes call them filters, even though they are lenses. In my opinion there is not a term for these devices that is both convenient and accurate. Some folks call them diopters. The problem is that the term diopter is also used for eyesight correction devices in the viewfinder of a camera, so the term "diopter" is ambiguous when used alone. Some people call them close up lenses, but that's also ambiguous because macro lenses could also be called close up lenses. Some people call them close up diopters. Some people call them auxiliary lenses, or auxiliary close up lenses.... and so forth.
Anyway, enough of that. You are basically correct in your description of their use, or to be more accurate, you are basically correct in your description of one way they are used, i.e. focus close with the main lens and get even closer by adding the close up diopter lens. As one other person pointed out, they are also sometimes used by setting the main lens to infinity and then setting the object to be photographed at a distance of one focal length away from the diopter lens. (That's one focal length of the diopter, not one focal length of the main lens.)
You will find lots of unsupported comments made about whether simple diopter lenses can give good results, but it is extremely difficult to find actual tests of that assertion. However, it is pretty much universally agreed that achromatically corrected diopters can give very good results.
As to simple close up diopter lenses, if you want to use those you should plan on stopping your lens down so as to reduce some of the aberrations that are introduced by the close up diopter. In most cases you are going to want to stop your lens down anyway if you are making close up photos in the field. This is to maximize your depth of field, so maybe that limitation of simple diopters (i.e. less than ideal optical quality) is somewhat overblown.
However, if you can afford the more expensive achromatic diopters, just get those and don't worry about whether simple lenses are good or not. On the other hand, if you can't afford the more expensive diopters then just buy the cheapo simple diopters and learn how to use them. I'm sure you have fun with them, and you will be able to make some great photos with them, and probably nobody is going to look at your photos and say "Hey, you used those cheap simple element diopters on this photo, so it can't be any good."
If you do go for the cheap single element diopters then try to use the minimum power you can for a shot, because that will introduce less aberrations into your image. For example, use a +1 diopter with your lens focused close instead of a +2 diopter with your lens focused at infinity. (This is really only practical with an SLR camera or other through-the-lens focusing camera for technical reasons. Otherwise you are stuck with setting your main lens at infinity focus and using a more powerful close up diopter.)
The simple diopter approach is not going to get you into the true macro photography range because the aberrations are too great on the really powerful diopters that you would need to use to get into that range.... that is unless you want to intentionally make fuzzy photos for esthetic reasons.
Another trick: diopters have a greater effect on long focal length lenses than they do on short focal length lenses.
By the way, another use for close up diopters is that if you have a lens that doesn't focus quite close enough to crop a portrait the way you want it, then a fractional diopter can sometimes be used to get you into the right range, and a fractional diopter isn't going to hurt your optical quality much, even at a somewhat wide aperture. However, fractional diopters are not easy to find, and they tend to be expensive.