I'm pretty sure Valve, like other online shops, have a content management team which optimizes the shop in all kinds of ways. Automation is probably heavily included but not completely running the shop.

iirc, they used to be curated, over time organic features were added to promote popular games, and the social update brought the "Recommended for you" pages.

You can tell explicit placement still goes on, as games that are in the news pop up, so do preorders of big titles, etc.

If I had to imagine, how it works now is theres several buckets of candidates, such as popular new releases, curated features (IE "New DLC Available" or "Preorder Now", "New on Steam" etc), and Recommended For You, and a certain amount of titles are shown from each bucket every time the front page is shown.

Depends on if you're logged in.

Valve made a huge update in the past 12 months, where if you're logged in, that shows games (and games similar to those) that you don't have yet recommended by the people connected to you. On the Steam homepage in Steam, about half the games in the top carosel say "Recommended for you".