You're right. For some reason I couldn't see the folders being created, but after restarting Firefox (about:profiles required me to do after creating profiles with the new UI), they are created.
Do you know if there's any way to have old profiles showing on this new UI?
When you open about:profiles in both your "new" profiles, you can see that even though it has the same name, the path changes.
So I think in effect they still behave like profiles before, just with some extra logic on top so they have names, icons and so on.