Is there currently a way to make the posts invisible to members in the "Recent Topics" list until the new message has been approved? I read through this thread and saw some discussion of it but thinking there is not a way.
The add-on works the way like it's provided now, and the approach you mention, is not possible in the current version.
For members it's not quite confusing. They see that their message went to the queue, and they see they have a latest reply on the thread, which is just not visible. Afterall, it gives an impression something has been posted, so they have just to re-click the thread each hour to check if their message didn't went away :-)
I suppose it's less confusing that if you post something and never see your message again, so you can't be even sure if it has been posted or not.
Try it - you will see it on your own. It doesn't confuse users, more so - I think it works for them.