The amalgamation only identifies two isomorphic subgroups, it doesn't perform any further quotienting. So the group you are amalgamating over has to be isomorphic to a subgroup of both $A$ and $B$. Thus your first statement is correct.
You cannot form an amalgamated free product of $F_2$ and a finite group with non-trivial amalgamation, because $F_2$ has no non-trivial finite subgroups.