On initial install, sure. But user accounts can also be created at arbitrary times. The user may have changed the set of photos in the intervening time and might even be editing the directory during profile creation.
I thought the same thing, and then wondered if this must be an enterprise problem, because what home user adds loads of icons - so many that IO becomes a concern - and also wants them to be randomly assigned to other family members?
But then it occurred to me that XP was of an era when you would absolutely spend an afternoon downloading some megapack of 10000 cool user icons.
