Not exactly, I mean putting the aircraft on a flight path where a terrain collision was going to occur (unless last moment emergency evasive manoeuvre can save it). So not so much using the rock as a waypoint, rather flying at a rock elevation ~300' whilst being at 200'.
and that would appear to be because they didn't realise that the WP they had asked for a 'direct to' was in fact a rock and not just a point in space.
I think legacy procedures may be a factor here - there is no need to let down such a long way out, especially not to 200'.
Since they didn't have NVG, there would be far more tendency to stay 'heads in' even at 200' whereas an NVG-equipped crew would transfer to 'visual' flight, backed up with the AP and sensors, as soon as they got below the cloud.
They must have been VMC below because the FLIR could see the rock - contrary to some opinions, FLIR cannot see through cloud and is very poor when there is little thermal contrast between the objects it is looking at.
The 'heads-in' mindset leads to careful changes of attitude and heading because it is treated like IMC (which it effectively is) hence the slow reaction to the heading request and the use of the HDG function of the AP rather than the flying controls, which would have been much quicker.
The primary fault seems to be the procedure and its design but there are so many contributory factors here that could have been removed from the equation.
Such overwater letdowns are very procedural in nature and can vary in difficulty depending on the weather and proximity to obstacles - I believe they were adequately trained to use the automation in these conditions but somewhere the basics of looking out the window (or the electronic version of checking the radar picture) were lost.
Did the training for the crew include the fact that at 80 kts with the gear down, the GPWS look-ahead distance was restricted to 10'?? And which genius thought that was a good idea for a SAR helicopter?