Hi Daryn,
The only records that we have to research are the Catholic records that you can access through Tombo.pt. Once you find your ancestor, it will state the parents (and the grandparents are listed on the baptisms from about 1860-1911). You just follow the paper trail back in time. You keep going until you run out of records or hit a pais (or pais) incognito.
No, the priest did not combine people together in the records. Your Jose Ferreira, married to Thereza Rapoza, had a Manuel. When Manuel was presented for baptism, the godparents also vouched that the parents named were indeed the parents. The priest didn't make up a different couple to be the parents of Manuel. Now RESEARCHERS (genealogists) can make errors when researching their families and can mix people up. But the priests and scribes didn't do that in the records. Hope that makes sense.
Happy hunting,
Cheri Mello
Listowner, Azores-Gen
Researching: São Miguel island: Vila Franca, Ponta Garca, Ribeira Quente, Ribeira das Tainhas, Achada