Fascinating topic. I'm not sure that I agree that a flattering photo is really a "lie." It's more presenting the person in his or her best light (figuratively speaking). I think that's something we all wish the world would do more often. Take everyone at their best and pardon or minimize their worst.
I could give you the counter example of my lovely 80-year-old mother, who loves to take pictures of her children and grandchildren. She has the truly amazing talent of catching everyone at their worst -- eyes closed, mouths open, noses huge and hot, etc. Are those snapshots the "truth," because they are unflattering, indeed awful? Not to me. Those are merely pictures taken at the wrong moment or from the wrong angle. They produce awful likenesses, in fact.
I must also say, in her defense, that her travel photography is excellent.
I guess your topic has more to do with "white lies" that are part of ordinary human interaction. Are those lies, or just the way we try to be kind, in hopes that the world will return the favor? To put it another way, with people we know, we generally focus on much more than appearance -- we know the personality, we hear the voice, we witness how this person treats others. We generally evaluate someone with much more input than: blond hair, pale skin, pimple on forehead. A photograph can't do that, of course. But in the two examples you have given (paid professional portrait or snapshot of friend or family), the photographer has an obligation (professional or personal) to emphasize or select the best of the person's appearance before presenting the photo.
In other contexts, for example Martin Parr's photographs of tourists, the photographer chooses to present the grossest or most comic aspect of a person on purpose. But the intent is not to illuminate the subject as an individual but rather to use him or her as an example of a larger and very cynical "truth" about the world in general. The individuality, the humanity, of the person is immaterial. Do those pictures present the "truth" about those anonymous individuals, or do they intentionally exaggerate surface appearances to make a point about how the artist sees society?
-Laura (who is now very self-conscious about how her pants look, thank you very much)