You have to turn off contents on that specific Functional Area. However, you can only turn off for new contents, so the ones you already have displayed you need to remove them manually (see attached )
Best practice is to use different functional areas for modules and for dashboards, so you could turn off contents for all modules only. I usually use capital letters for Dashboards's functional areas to distinguish from modules.
Re: How to hide Modules and its views under Contents section
Please switch the drop-down: Show new items On to Off and repeat this for each functional area. This drop-down will prevent new modules in a functional area from showing up in the contents pane automatically.