Your initial understanding is not quite correct. Confusingly, the "secondary" radar is often the "primary" source of all information, including range and bearing. In a modern radar with both primary and secondary returns the two are synthesised into a single target by the computers that drive the display. The response from the transponder can often be more accurately seen in both range and bearing than the primary, and therefore it will be the determining input for the position. This is particularly true when there is a lot of ground clutter or weather interfering with the primary returns, and some radar site operate ONLY with secondary returns, because the primary would be unusable.
Having said all that, I don't know the answer to your question as to whether any radar computer tries to correct for slant angle, but I suspect not. In the en-route environment the error is infinitesimal, but I suppose a keen radar designer might try to do something clever for a terminal radar. Note that if the radar is on the airfield, an aircraft on a 10 nm final (3 degree glideslope) will actually appear to be 12 feet further away than it really is.
