Yes, they hold the passport till they are satisfied that all requirements are met. That's when you see the 'decision made' status. The approach is quite inconsistent though generally people report receiving a ppr within 30 days of sponsor approval. From this point on, its a waiting game, if the case is simple and no travel history, it could be much sooner than the 6 month timeline.
And yes, send the additional documents with a cover letter explaining what these are. You can say, in reference to the PPR, pls. find attached the PP bearing #xyz as well as additional documents supporting our relationship - photos, chat histories etc. (or something along these lines). Don't forget to attached a copy of the letter they sent you.