That is a clear explanation of the situation for these kinds of illusions.
But notice it's not how sustained area spells work as per the general rule. There is in fact two way of handling S/A spells. One that applies to spells like those you mention, and Poltergeist; the other that applies to spells like Mod Mind.
1) “Movable emanation” spells
E.g. Those work like indicated p. 282, step 7b, but contradict 2f, p. 281.
You create a “cloud”, and you can move it. Affected creatures change depending on who finds itself in or out of the area. You don’t need LOS to individual targets, rather to the general area (e.g. if you Mass Animate a box of bearings, you animate the bearings, not the box).
2) “Multi-Lock-on” spells.
E.g. These work like 2f p. 281 but ignore 7b p. 282.
Targets are selected at time of casting, then they don’t change, and you cannot “move” the area, because it doesn’t really persist. These are not “area” spells: they are “multi-target” spells, much like casting the single-target version several times at once (in the same way that Manaball is, in the end, a multi-cast Manabolt).
If one would insist on following RAW, results are weird... Like phantasms that only affect you if you are within Magic meters of the center AND in LOS of the caster and so on.