Yes, it is conditional: an expression of potentiality and a degree of uncertainty. I think when you state the two options, you miss the force of the first phrasing by writing it in its elided form. If you state it in its long form it becomes more obvious:
I would prefer that you did not address me as consul
Similarly it is politer to say:
Je voudrais un café
as opposed to:
Je veux un café
I have heard people use the latter in shops/stores, so presumably it is not appallingly rude, but the first form is definitely more polite.
Similary, if you wished to make a polite suggestion to someone that they should do something you would use the conditional of «devoir», e.g.
Vous devriez fermer votre fenêtre car il va neiger.