Yes, that is the engine compartment temp sensor. The DME reads the actual temperature, and has preset programmed temperature limits, when those are exceeded, the fan runs until it drops down in temperature.

Greetings Jeff
I have a question I think you might be able to answer.
My 2003 Boxster S has a temperature sensor plugged into an air intake runner on the top side of the passenger side of the engine wired directly to the ECM. My sense is that this sensor is associated with the engine compartment cooling fan operation. Can you confirm this? If not, how is this sensor information used by the ECM?