Most of what you’ve laid out is spot-on, but there are some nuances (I’m in the business, so I’ve got some experience in the matter).
Tenure-track faculty at the prestige research universities typically have minimal teaching duties (one undergrad class and one graduate class a year is not unusual), and for many of the top researchers (not all), teaching classes is essentially a nuisance.
Somebody has to deal with the undergrad classes, and that’s where the lecturer staff comes in. Their teaching loads are typically 6 classes per academic year, generally all undergraduate, and often with pretty good size classes. It’s true that they are not (and generally cannot be) tenured, but many - perhaps most - are so essential to keeping the courses staffed that their yearly contract renewals are almost automatic - if those lecturers disappeared overnight, there’s not way the university could offer the number of classes they do.
The major difference between the tenure-line professors and the lecturers is that the former are the world-class scholars and researchers who give an institution its professional reputation. The lecturers are often great instructors, but they seldom engage in much research, and generally aren’t nearly as high-powered professsionally.
Obama was an exception even to the normal professor/lecturer distinction, in that it appears that not only was he not distinguishd in terms of his professional work (he had none), but that he wasn’t even much of a teacher. He certainly wasn’t one of the faculty who maintained the day-to-day staffing that the U of C needed to keep classes staffed. To all appearances, he was simply granted a teaching assignment or two as a resume enhancer - he essentially faked his way through teaching a couple of classes, and as a result got to associate himself with the prestige of the unviersity.
What the university got out of the deal was the political connection (the value of which is not to be underestimated in Chicago). It was a situation similar to that of his wife with the U of C’s med school - she made a good buck in a job that disappeared once the Obama’s moved on to bigger and better scams.