Answered
Pre-composed Issue
Why is it called pre-composed? This activity separate & creates the layer in a new composition. In my view most sitable name is post-composed.
When you have one comp inside of another it is called a "Nested Composition".
Pre-compose take a selected layer or multiple layers, placed inside their own composition and then replaces them on your timeline with the new nested comp.
The idea is the the nested comps feed into the parent comp, they exist before (pre) the composition you are using them in.
The flowchart and mini-flowchart view can help you visualize this relationship.
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