You mean it refers to the future sacrifice of Christ. A shadow of "things to come".
They were using this verse to support OSAS gospel idea- Jesus blood covers and doesn't see our sins). I know this is a shadow of things to come. I understand it differently to OSAS believers. It doesn't refer to imputed righteousness.
I think I understand the point you are addressing.
In one theology, Christ blood covers us from our sinful state (unresolved and continuous), so God does not
see us, sometimes called imputed righteousness.
And I agree this is a miss-application of imputed righteousness to my mind. Abraham obeyed God, did things
God was pleased about, was a righteous man, yet it was his faith that made him righteous not his deeds.
In their mind Abraham was a sinner, fallen and due for judgement like anyone else, and he was never righteous.
In their way of thinking if anyone was righteous through deeds they do not need God.
The failure is being righteous without God is sin itself, as God is the source of all things, and its essence, so
rejecting Him is sinful and leads to sinful behaviour. Put simply the focus on self leads to self justification of
selfish acts which corrupts the soul and destroys everything one touches.
So everything in terms of righteousness, being true, pure, Holy, is founded on our relationship with God and His
dwelling with in us. It is like His very presence makes us Holy, not our deeds at all. I wonder if it is our language
and way we think and express ourselves as created beings, find it hard to grasp and express this reality.
Because in Adam and Eve we inherit being separate from the Lord, to gain communion is unique and only grows
as we experience it, so words describe what is, and we understand it because we know it in our lives, yet to those
separate, it is gibberish.