How do packets know where to go when traveling between intermediate nodes? Is the destination address updated at each intermediate node? Does the application layer need the other 3 layers when setting up communication the other application layer? Is my understanding wrong?

My understanding is that every layer need only concern itself with its corresponding layer. For example, the when the receiving end host receives the packet, the packet is encapsulated. The transport layer encapsulated the application layer, the network layer layer encapsulates the transport layer, and the link layer encapsulates the network layer. This data is sent, called the PDU (Protocol Data Unit) and is received by intermediate nodes. The nodes do not know where the packet is going, but each packet has an IP address, a destination address, and a source address to which the intermediate nodes send the data to. Eventually, the end host receives the packet. When the packet is received by the end host, the packet moves through to 4 layers, from link layer to application layer, being de-encapsulated at a time. During this de-encapsulation process, each layer is only concerning itself with data from its associated layer, e.g., the receiving transport layer is dealing with only the sending transport layer, hence the term, peer to peer process. Correct if my understanding is wrong

My questions are: When the data is going through these intermediate nodes, is the destination address the receiving end system or is it the intermediate node at the next hop? When the application layer is setting up communication, does it need the network layer, the transport layer, and the link layer to set up the communication?