Kotless autowarming is essentially just a cron that calls an endpoint every couple minutes to keep it in the AWS ready queue. Is my understanding of this correct?

Yep, it is a sugar for scheduler. The only difference that during auto warming Autowarm-event subscribers are fired

so should it completely handle the cold start problem?

Well, it should help. For example projects it eliminates problem almost completely under moderate load.

currently am using ktor. I do notice the cold starts but they are honestly not that bad.