You ironed the 'nubby' side onto your T-shirt fabric, then peeled off the backing paper, right? Now you see the shiny side, where the backing paper was peeled off. That side is to be ironed onto another fabric, thus adhering the two fabrics together. The 'Lite' is meant to be sewn through afterwards, as dryer heat or ironing will loosen it again. After it's washed, the 'Lite' area will feel as if you've used a slightly heavier fabric but it shouldn't be overly stiff.
I've used the Heat n Bond Lite for small appliques (then sewn around them) but never for something as large as a T-shirt front, so can't advise as to how much stitching is required, to keep your fabric stable.