The time in which one sleeps is not the only variable that matters. I rather have 5 hours of restful, deep sleep than 8 hours of tossing, turning, and waking up every couple of hours. Plus, there are other variables like how close to sleep was your last meal/snack, what time you go to sleep and wake up at, caffeine intake, etc..

Can some people function better on less sleep? Sure, but I would need to see more data on this topic before I believe it is as widespread as I anecdotally hear it.

Are these people that need less sleep actually performing better, or they do they merely believe that because they are inhibited by their lack of sleep? I am pretty sure there have been studies observing this effect. One "thinks" they are performing better, but reality begs to differ.