The simple reason for this two-step approach was that the ColdClone version doesn't support newer vSphere versions. The conversion to the Workstation format creates the VM's files on the specified location (e.g. a file server). For the second conversion install the Converter on e.g. a PC, select Workstation VM as the source type, and point to the VM's .mx file.
What I usually do as the first step after conversion - i.e. prior to powering on the VM on the target - is to create a snapshot. Then cleanup the VM (remove hardware related drivers, services and tools), install VMware Tools, and finally - if everything works as expected - delete the snapshot.
André