To some degree yes, apktool will unpack the apk and disassemble the dex files in a way in which you can modify them and then compile the project again, sign it and deploy it (as long as your device supports it).

In this case you would have to either modify the smali code itself to make those changes.

When the modifications are basic such as changing a few instructions to avoid checks or adding simplistic payloads writing them in smali is just fine but if your modifications are more substantial I'd suggest creating a placeholder java project, decompiling it and adapting that smali so it's less of a pain in the neck.

Another valid approach would be embedding a custom shared object or fridas gadget with a configuration file to run a payload on start.

As for understanding what you need to change and how, jadx is the way to go most of the times but for some nastier code you can either use dex2java and then jd on the converted file or just go straight to the smali code (honestly that's not that usual)

Also, while testing your patched version I'd suggest heavily using and abusing frida in a rooted device if possible.

Note : I don't usually use the "create a java project" option so your mileage might vary but I recon it's probably the easiest.