You're not going to like this, Krissy. That is, unless you like indecision.
After looking around a few websites, I've found it to be both ways.
It could be that someone looks so much like someone else that they were split from them. Or it could also be interpreted as though they look so much alike, one person spit the other out.
Phrases.org sites the phrase as meaning "the exact likeness."
I found a 2010 Chicago Tribune article about the very topic. The article quotes the proper saying as "the spit and image."
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