I would imagine that there is a catalogue of images, and the location pointed to stored for each image. You could manually tag 100 photographs quite quickly I'd imagine.

For a small number of photos (up to a few thousand), a linear search (i.e. check against each one) would be quick enough. You could compare the distance of the pointed spot to the cursor (using Euclidean distance), pick the best one, maybe add in a random factor.

EDIT: Somehow the author is putting Voronoi diagrams into use. Take a look at the source.