One more thing - in the early versions of photos, hiding the photo did only hid it in the library view (Moments, All Photos), but not in the albums we created, exactly as you want it to work. But many users complained, that hidden photos remained visible in the albums, for everyone to see. People misunderstood the "hiding" feature as a tool to keep confidential photos secrete.
And finally Apple changed the Hiding tool to a tool to keep selected photos secret and added even a password protection to the Hidden album and the Recently Deleted album, so we can lock very confidential photos away. But now we lost the ability to manage the library view and remove the photos we have added to albums. A pity that Apple did not add a Restricted Album in addition to the Hidden album, so we would have both, the ability to remove photos from the library section, but the secret area for confidential photos.
On macOS 12 and macOS 13 the Hidden album is password protected. And you have to reveal it in Photos:
Hide photos from view in Photos on Mac – Apple Support (UK)
Show photos that you’ve hidden
- In the Photos app on your Mac, click Library in the sidebar.
- Choose View > Show Hidden Photo Album.
- The Hidden album appears in the sidebar.
- Select the photos you want to display, then choose Image > Unhide [number] Photos.