Needing to convert yaml to hcl seems like a burden. A killer feature of HCL would be if it supported syntax highlighted yaml. Or if the HCL manifest was in json format, it perhaps could be easily then converted to yaml as the "human readable" format, then converted to json and tf apply.
You can use YAML files with kubernetes_manifest resources if you like, though you'll probably run into issues that the bespoke resources (e.g. kubernetes_deployment) handle for you.
Yeah that's definitely the way to go if there's already a helm chart. If it's just raw manifests I'd rather convert to HCL than build a helm chart to feed into TF, but that's just because I know TF better, most of my configuration is already there, so I'd prefer to keep abstraction boundaries small. But it's nice to have the options.