Yeah, something's up with that option. I'm jealous with that super cool and factory looking pump module though!;D
But it doesn't look like it's going to work properly in the tank. As you suspect, it should normally go all the way to the bottom of the tank.
Nothing wrong with using a module that has it's own feed and return fittings of course, as you can cap off the existing ones in the tank. But this one also looks like you're expected not only make a hole, but one that would utilize a factory style recess for the module to sit in, and also come up with a solution to retaining it. This style normally utilizes that spin-on ring style mount with a retainer like this:

, an o-ring seal, and the actual retainer for the ring to ratchet into.
Not sure how you would just make one of those up without lots of extra pieces included. Usually when that's done, someone goes to the junkyard and cuts the section out of a factory tank with the proper sized opening.
You can see in the kit instructions at the link broncodriver99 posted up that the as-designed way to connect an in-tank pump is to use the inner, built-in pickup tube to connect the pump to. It's where that S-shaped rubber hose comes in.
The module you have is super slick and looks like it might even be utilizing the factory style push-lock connectors. Which is cool and all. But also looks like you might be working with a 18 gallon tank instead of a 23 gallon one at that point.
It does look like it would only take some simple extensions to make it fit to the bottom however. But that's a lot of work and you'd still be stuck with how to attach the round ring top to the tank's plate. Glue-n-screw? Doubt it, but you never know.
I wonder if they normally do that in-house, or if this is simply an incorrect unit?
What do the instructions say?
Sorry you're running into this on a good long Bronco-work weekend, but at least you don't have long to wait before getting in touch.
For now it's looking like Beer:30 somewhere.
Good luck. Interested to see what they say.
Paul