WindowsPE phase settings not executing

Question

I'm working and learning on Windows deployment. So far, the thing I am doing is editing settings in a Windows 10 Pro installation inside a virtual machine.

After editing the settings for machine, I sysprep it with a answer file and reboot the machine. Most of the settings come through.

Now I wanted to create partitions via the answer file, and hoped I could test this on the same way, sysprep the machine and restart it.

After pasting something likethis into my answer file:

<settings pass="windowsPE">
    <component name="Microsoft-Windows-Setup" processorArchitecture="amd64" publicKeyToken="31bf3856ad364e35" language="neutral" versionScope="nonSxS" xmlns:wcm="http://schemas.microsoft.com/WMIConfig/2002/State" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance">
        <DiskConfiguration>
            <Disk wcm:action="add">

                <DiskID>0</DiskID>
                <WillWipeDisk>true</WillWipeDisk>

                <CreatePartitions>
                    <CreatePartition wcm:action="add">
                        <Order>1</Order>
                        <Size>25000</Size>
                        <Type>Primary</Type>
                        <Extend>false</Extend>
                    </CreatePartition>
                    <CreatePartition wcm:action="add">
                        <Order>3</Order>
                        <Size>25000</Size>
                        <Type>Primary</Type>
                        <Extend>true</Extend>
                    </CreatePartition>
                </CreatePartitions>

                <ModifyPartitions>
                    <ModifyPartition wcm:action="add">
                        <Active>true</Active>
                        <Extend>false</Extend>
                        <Format>NTFS</Format>
                        <Label>USERS</Label>
                        <Letter>U</Letter>
                        <Order>1</Order>
                        <PartitionID>1</PartitionID>
                    </ModifyPartition>
                    <ModifyPartition wcm:action="add">
                        <Active>false</Active>
                        <Format>NTFS</Format>
                        <Label>PROGRAMS</Label>
                        <Letter>P</Letter>
                        <Order>2</Order>
                        <PartitionID>2</PartitionID>
                    </ModifyPartition>
                </ModifyPartitions>
            </Disk>
        </DiskConfiguration>
        <WindowsDeploymentServices>
            <ImageSelection>
                <InstallTo>
                    <DiskID>0</DiskID>
                    <PartitionID>2</PartitionID>
                </InstallTo>
            </ImageSelection>
        </WindowsDeploymentServices>
    </component>
</settings>

And sysprepped my machine and restarted it again, the partitions were not created. The disk configuration was exactly the same as before.

The answer file has been validated and is ment for a 64bit machine.

When researching the windowsPE settings, I came across this TechNet article where it states:

One of the following takes place:

1. Booting the Windows Setup media
2. Starting Windows Setup from a previous Windows installation

The Windows PE options are applied only when you are running Windows Setup from a Windows PE environment. The Windows Setup options are applied when running from both Windows PE or a previous Windows installation.

Does this mean this part of the configuration only runs when I capture the image of this machine, then boot into Windows PE and apply this image on another computer?

How does this work? I don't understand a single thing of it.