These are technically called Eigenfaces - I first read about them in Scientific American back in the '90s (they were called eigenheads back then) and they looked way freakier. The original research I read basically said there were something like 70 eigenfaces and everyone's face was nothing but a cross of three or less eigenfaces, much like any vector is the sum of two eigenvectors.

This is absolutely the way CIA/FBI/NSA facial recognition works. The paper I read was funded by DARPA if I recall.