I don't think anyone's suggesting doing without animals - just that the industrial farming of animals is totally unsustainable. Animal farming used to be done by grazing on marginal land or, as you point out, by using marginal products as feed, as opposed to using prime land to intensively produce cattle feed.

When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done. — John M. Keynes

It depends on the region and its climate and its weather patterns.

Generally speaking, a diverse farm operation, including animals, produces more food value/acre than a comparable specialized farm.  That's because a diversified farm has more than one use for a particular piece of land, e.g., using the orchard for sheep grazing (grass & windfalls) and hay production.

To answer your question, yes.  Typical nitrogen fixers are clover or alfalfa.  Typically they are planted with grass to provide pasture/hay.  The animals graze the pasture and their dropping help fertilizer the ground.  An additional benefit to using the ground this way is that it helps to break disease and pest cycles.

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