I first checked them out the day they opened (July 05), and was using them daily by January 06. There were definitely real people and a growing community by then.

I wouldn't attribute their success to fake accounts, although the fake accounts were probably necessary to seed the community. Rather, they took off once they added comments (Dec 05, IIRC). It's the same story as Whatsapp (messaging), YouTube (related videos), and AirBnB (pro photos): there was one feature that they really needed for product/market fit, and once they added it, people started using the product on their own.

Reddit gained traction because its frontpage was accessible to everyone (no signup) and it updated more frequently than Digg. The stuff you read on reddit turned up on Digg later and slashdot days later. Eventually you stopped going to Digg because you'd read everything already on reddit.