Direction on how to edit hosts file

[NamamiShanker]

Hello devs! Thanks for making this playbook. I am trying to set up a TunSafe VPN server on an AWS EC2 instance. I am having difficulty understanding and editing the hosts, Specifically the lines:

[tunsafe]
#Pick and adjust ONE of the three connection string options listed below.

#Option 1 - Uncomment and adjust the example below when using password-based auth to connect to your server
#123.123.123.123 ansible_user=demo ansible_password=P@$$w0rd

#Option 2 - Uncomment and adjust the example below when using key based auth to connect to your server
#123.123.123.123 ansible_user=namami_tunsafe ansible_ssh_private_key_file=/home/namami_tunsafe/.ssh/privkey.pem

#Option 3 - Uncomment and use the example below when running Ansible locally on the server.
#127.0.0.1 ansible_connection=local

My questions are:

1. Does this playbook create a TunSafe VPN server?
2. I currently connect to my EC2 instance with a privatekey.pem file. That file is located on my laptop which is the client, not on the server. So do I need to scp my private key to the server. Also, should the IP address be replaced by external IP of my EC2 instance?