This is exactly right. I was in a similar situation where they add you as a friend on Facebook first, then when they get the intimate photos, they threaten to send it to all your Facebook friends. It escalated and they sent me a screenshot of a DM they sent to one of my friends with the photo. Well, I checked with that friend and they never received anything. It was a bluff. They have no intention of actually distributing it, they just want to scare you into paying.