Here is the code that i got from "Beginning PHP5,Apache, MySQL. Web Development" book.

function get_director(){
         global $movie_director;
     global $director;

$query_d = "SELECT people_fullname FROM people WHERE people_id = '$movie_director'";

     $results_d = mysql_query($query_d)
             or die(mysql_error());
     $row_d = mysql_fetch_array($results_d);
     extract($row_d);
     $director = $people_fullname;
 }

My question are where did $people_fullname's value come from and if the value is from "extract($row_d), then how did $people_fullname get the value from "extract($row) ?

Your query statement is to get values for fieldname people_fullname from table people. The values could be an array of rows retrieve for the query statement or just one row. extract($row_d); is the same as listing of record values from your statement which in this case is only one column/field that is people_fullname.
hope this helps,
jmaronilla