No, the setting is a little confusing, Disabling ‘embed truncate’ on Discourse has no effect on what is being published to Discourse from the wp-discourse plugin. As long as the ‘Use full post content’ setting is not enabled on WordPress, only excerpts of your posts will be sent to Discourse.
If you’d like to set the content of the post excerpt on WordPress, make sure that ‘Excerpt’ is enabled under ‘Screen Options’ on the WordPress post-new page. You can then add the content that you would like to be published to Discourse to the ‘Excerpt’ meta-box on that page.