In general, yes. But certain situations call for a more personal use. Per se if a politician were to speak about a demographic they'd say "personas" but if your mom was saying that your sister is a person she'd say "ella es una gente tambien". It just depends. You won't get reprimanded for using either, it just sounds weird to certain ears.
When would you use this phrase? Shouldn't it translate to "They are not women" because it is all feminine. I understand that persona= person and personas=people...but I do not understand why someone would say "They are not people" in a feminine format..
Persona is always feminine.
Ella es una persona.
Él es una persona.
Perhaps there is a group of women, and you discover they are robots. Austin Powers says, "¡Ellas no son personas!"
It's not just about understanding. It is also about imagination. Maybe those aren't people--they're just mannequins, they are aliens, they are avatars.
Maybe when talking about cows: Son vacas: ellas no son personas..... Mayhaps.....
'Ellas' is used because everyone included in 'they' is a female. Had the been all male or a mixed group they would have been 'ellos.' And still to say someone or people are not people is a different (harsher) meaning than to say they are not a certain gender. Had these ladies not been women: Ellas no son mujeres.
Femeninity of a noun (non pronoun) implies the gender of the noun. They are not women (ellas no son mujeres) implies more than personas in this situation. And you are questioning the person's gender itself with that sentence anyways.
Racism? Betsy, you raise a great point. In English you and you audience can "not care" about the gender of a noun. In Spanish you must specify it even if you just decide to use the (male)default such as in "esto" This (unspecified object, male by default). So when the grammar forces you to recognize the group as feminine it is not saying anything (necessarily) about the following noun except the grammar should match. Ella es ama de casa, él es amo de casa (housewife/ househusband). Ellas no son niños, ellos no son niñas--does not match (in support of the statement)
Is there any difference between using the terms "persons" and "people" as there is in English?
Slight. Persons is a bit more specific (and countable) and refers to those the speaker kind of already has in mind. People is more of a general like (undifferentiated) group. Example: undecided persons at the rally vs. the German people. This is at least my understanding of it, but ultimately you will be understood using either one.
Ellas no son personas. Ellas on extraterrestres, pero extraterresstres tienen género????