Hi Louise, this post is purely about imagery, and not about the personas themselves. My process for persona generation involves meeting with the various stakeholders and going through some elevator pitches. These are to uncover who business feel are the people that they are solving problems for. I then use these to generate proto personas, which are based on the assumptions held in business.
I use the proto personas to then resource and interview people, and using that knowledge is how I put together the personas.
There's a lot of pros and cons with personas, and I know that there is some push back but I've found them really useful to get everybody on the same page.
So yes, you're right, persons are based on real insights that you get from user research. The images I use are not of people that I have spoken with though, they are representative.