Yeah, ISM will create personalities such as the neighbourhood hussy which it stores as a homeless family. It also will create families based on how many houses are available: in my 'hood I started with 12 empty houses, and ISM filled up 8 of them within a Sim-week with new families.
Since I put a few blue-, green-, and redskinned Sims in the bin along with nice face archetypes, I now have a nice and varied 'hood.
ISM also saves a list of all your library bin sims as homeless. Somehow they don't move into town, like service npc's, nor age. Apparently they're just there as breeding stock. My library happens to contain archetypes that I've made personally, top level bosses for each career to prevent fewer unqualified promotions. Since they're homeless in ISM, AM uses them as bosses in those test neighborhoods.
On another note, ISM may be counting lifetime reward traits as regular traits. I'll actually play a "backstory" of some families, then place them in the bin to incorporate into my main town. These sims tend to have purchased traits. All of my immigrants in ISM start with seven regular traits.