Are you wanting to use the photos as your screen saver and have it cycle through all of those photos?
If so, it will show you whatever photos you have depending on which folder you're choosing from the source drop down.
I suspect you're thinking that just because it's title or name is Photo or Photo Library that all those photos you see in your Pictures folder should also show up in your Photo Library folder because they're pictures and library makes you think it should have All of those photos. Sometimes you end up with folders within another folder and you have to make sure as you go through the drop down selection that you've gone through the folder "tree" to get to the folder you want. You could also if that doesn't work just create a new folder and put all the pics you want in it and choose that. It depends how you like things set up, I like to keep folders I want to find easily on my desktop so all I have to do is select desktop, then from that window select the folder I want. You might just have the folders set up differently on your wife's computer and should use hers to see how you got the folder on hers as the one that you seek, the left sidebar should allow you to backtrack, click the arrows to point down is what I mean by tree, that should show you why they're on hers but not yours, I think they're there, I just think it's a folder within another folder and folders will only have what you put in them. If you have pics you want in iPhoto you could also arrange those into a folder and choose that or just all of iPhoto and it will offer the same arrows to either events or all the pics in iPhoto, but sometimes you have to choose a folder and hit open to then get the one you want that will then say choose. Hope this isn't confusing if so let me know I could probably shorten it.