I'd rather imagine it like when you look upon a specific creature you simply know the condition, as it is sight based ("Using the foul sight..."), not that it is some sort of weird sense, that tells you in what square creatures with what condition are positioned. There's not really anything in the description pointing that way, or is there?
From a balance point of view it's probably better to have it be rather vague there. It's only a 1st level spell after all.
But as it stands, it certainly allows to pierce illusions, since they won't have any life force and thus are easily reckognized (well, not as an illusion, it could also be a construct or whatnot, but at least that something isn't right there).