Yep, siding was installed wrong AND Hardi says DO NOT caulk the joints between boards, only where it meets corner boards or windows.
Definitely needs flashing behind every joint; I use aluminum but tar paper will work.
With that big a gap, try applying the Bondo to only one end of a board and use a piece of aluminum flash or tar paper between the other end. Hardi does not recommend a gap at the butt joints.
HardiePlank Lap Siding
The boards must be allowed to expand and contract so bridging the joint with Bondo is not good.
Do a couple of boards and see what happens before doing the entire house.