We do this drill often in clinics. It has a multitude of purposes. It usually follows our warm up drills of groundies, approaches, volleys and overheads. Sort of puts all that together in the approach drill. On our drills, we concentrate on placing the approach down the line or down the middle with depth. Then we both go to net as fast as possible, bringing in the volley excercise fromt he warm-up. Of course the other team is attempting to get to net as well. Often the approach generates a defensive lob, binging the overhead practice from warm-ups into play.
It doesn't always happen, but we try to avoid two back or even one back except when defending a lob. The point of doubles is to take charge of the net quickly, if possible. Of course, the other team is doing the same thing. so both teams should be in constant motion goiong somewhere, keeping the feet moving.
I have never yelled "approach" to my partner. It would freak me out if they didi the same to me. How to handle short balls is up to the hitter. May be a heavy top spin ball deep or angled, could be a slice deep or could be a dropper. Yelling "approach" is overkill. Your partner should know what to do with it depending the location of the opponents and their skill levels. IMO.