In the default Libraries, you have to included locations by default. One the "Public" (all users), and the "My...." (Current user's C:\Users\(user-name) folders only).
Your sister will not see what is in your "My Pictures" in her "My Pictures" since that is your user folder and not hers. If you would like for her to see it as well, then you will need to copy them into the C:\Users\Public\Public Pictures" folder. Anything in a "C:\Users\Public" folders will be shared by all users by default.
Hope this helps explain it better. If not, then please just let me know.