Yes, I believe that it was always the idea that Cordelia would have been possessed by something while she was "up there", I guess that Joss was annoyed because he thought that the original plan would have more of an impact with Angel having to fight and kill a monster that was wearing the face of the woman he loved/inhabiting her body. Instead she kind of faded out at the end of that arc with fans asking when she was going to wake up from her coma, while Joss was talking about Cordelia's arc being done and there being nowhere else for her to go

And then you get fan lore that we only lost Cordelia because of the actresses pregnancy angering the writers and forcing them to come up with that arc to get rid of her, but I'm fairly sure that Joss was always ambivalent about doing anything more with the Cordelia from seasons 1-3, the season 4 villain arc was always planned to bring a dramatic end to her character