Yep - that's what it is. Seal gone in the clutch master cylinder that allows fluid to be drawn in, with some air trapped in the clutch line to the slave (or at least, that's how it makes sense in my brain.)
Once it heats up, or you pump the pedal a few times to build up some pressure, you can get sufficient pressure to enable clutch release.
If you try to bleed it, I bet you get *some* fluid, but it won't continue to stream even with pressure on the reservoir. And if you pump the pedal with bleeder open...similarly no more fluid.
Note that if you do bleed off that fluid and no more comes out, you'll have no clutch pedal anymore - it'll go to floor and stay there.
Master cylinder is a real PITA the first few times you do it; but once you get the hang of how to get that hydraulic line inserted, it's not too terrible.
