1. This recipe is for making "Heated diamond", which is one of the base ingredients for making "Infused diamond".
2. To actually craft any armor/tool, you need first craft the "Infused diamond" and then heat it again in a furnace.
"Heated iron ingot" is the second and final ingredient for "Infused diamond".
You also need to heat the ingot to craft iron tools, armor and horse armor.
"Heated gold ingot" is required to craft gold horse armor.