We refer to images and statues in our Church as sacred because they represent, or are related to, God Himself who is all holy.
Images or statues of people are sacred in the sense that, though not God, they lived lives of holiness that modeled Jesus very closely and in that sense they were In Christ.
As for the Holy Inquisition, I’m not familiar with the book you have cited but New Advent would be a good resource to use:
This article from our colleagues at Catholic Answers will also help:
These postings from our database should also give you valuable information. Especially the first five:
I hope this helps,