Basically yes, but I think it's actually the video card that converts the signal to VGA in response to a chip on the VGA dongle or a chip in the monitor telling it to send analog. I'm not completely sure about this since technology changes so fast, but I do know RAMDACs have been part of video cards for a long time now and it would explain why no power is needed. I've also recall hearing of people unable to use an DVI-VGA adapter with certain motheboard's DVI outputs (see below) which I believe is due to them not having analog conversion.
http://www.overclockers.com/forums/showthread.php?t=584025
The DVI->VGA adapter in that thread is a passive one that requires the video card to send an analog VGA signal just like the passive DP->DVI adapter does w/DVI. That dongle does nothing but rearrange wires and tell the video card to send the appropriate VGA signal and can't be compared to the DP->VGA adapter, it's more like the DP->DVI passive adapters.
I believe many newer DVI outputs especially in laptops don't bother providing the analog output over the pins provided in the DVI spec for analog VGA (it's the small block of pins separate from the rest) to save money which is the reason that adapter didn't work for the poster.
The DP spec doesn't even have pins specified for analog output so a VGA adapter would necessitate active conversion to get VGA, which is where that chip in the adapter comes in.
Wikipedia seems to confirm this by acknowledging single link DVI interopability but noting the need for active conversion for VGA, analog, and dual link DVI:
"In the interest of interoperability, the DisplayPort connection is capable of supporting HDMI/DVI signals. DisplayPort has issued guidelines on the construction of active DisplayPort-to-VGA, DisplayPort-to-SVIDEO/Composite/Other, DisplayPort-to-Dual-Link-DVI/HDMI, and Dual-Link-DVI/HDMI-to-DisplayPort Converters."
And from everything I've read the TDMS and RAMDAC share much of their operation on chip, using the same clock generators of which there's only 2 on chip. So I'm pretty convinced the DP->VGA is an active adapter as it shouldn't be possible to passively send VGA over the DP port, and doubly impossible to send VGA over DP when both clock gens are being used by TDMS signals.
But this is all what I've put together from the bits and pieces I've read when I was researching DP for my Eyefinity setup, I haven't seen a definitive explanation of all this.