I'd like the answer to this, too. I haven't cruised since 2018, before this was required for online check-in. And my passport is nearly 10 years old -- from a time when the photo truly had to be a mug shot -- no smile of any kind allowed. DH just renewed his passport and now the photo can be a neutral, natural expression, which can include a close-lipped smile. Does the expression matter to NCL? I seem to remember back when we would have our photo taken at the check-in desk at the pier, it was okay to smile.
The link posted by CILCIANRQTS about "preparing for your cruise" only says this about the photo: "Take a Selfie Photo: Use your computer webcam or mobile phone camera to capture your pre-cruise security photo." TIA!