I finally upgraded my iPhoto software and it now recognizes photos. My OCD nature has required me to go through all my photos and start labelling the names of people, with the assistance of the software.
It tends to do a great job (as seen below by Wen's gran, who is now on the internet!):
However, it has failed miserably with my dad, identifying him - amongst other things - as a thicket of snow-covered trees, waterfalls, a stilt house, Japanese masking tape and Damian Hirst's crystal skull.
Don't worry dad; we know you when we see you.