Improve and update FAQ entry for unique ID (#16260)

Co-authored-by: Franck Nijhof <git@frenck.dev>

source/_faq/unique_id.markdown

@@ -4,10 +4,36 @@ description: "This entity does not have a unique ID?"
 ha_category: Configuration
 ---
 
-When you see
+If you try to access the configuration dialog for an entity in your Home Assistant, you might end up seeing this message:
 
-```text
-This entity does not have a unique ID, therefore its settings cannot be managed from the UI
-```
+![Screenshot of popup for no unique ID](/images/faq/faq_no_unique_id.jpg)
 
-this simply means that you can't change the `entity_id` or the friendly name from the UI. You can still use the _Customizations_ menu to customize that entity. Typically you'll see this when you create entities using YAML.
+This means that this entity does not have a unique identification, e.g., a serial number or another identifier that is guaranteed to be static and never changes. As a result, the normal editing process that allows you to change various settings through the user interface (such as the entity ID, icon, friendly name, etc.) is not possible here.
+
+Typically, you'll see this when you create entities manually using YAML, but it can also appear if the integration that provides this entity, cannot determine a unique ID. This however is not an error, but just a limitation of the integration you use. A few selected integrations (such as [`template`](/integrations/template/) and [`mqtt`](/integrations/mqtt/)) allow the user to define a unique ID.
+
+### Used where?
+
+**Unique ID:**
+
+- Only internally in Home Assistant.
+
+**Entity ID:**
+
+- Entity with a unique ID: Entity ID only used as a reference, e.g., in automations or dashboards.
+- Entity without a unique ID: Entity ID acts as the replacement for the non-existing unique ID plus as a reference, e.g., in automations or dashboards.
+
+### Can be changed?
+
+**Unique ID:**
+
+- No. It is a static identifier.
+
+**Entity ID:**
+
+- Entity with a unique ID: Entity ID can be adjusted freely (as long as it follows the format `<domain>.<id>` and does not result in duplicates in your Home Assistant). Keep in mind that if you change the entity ID, you also need to update the references, e.g., in automations and dashboards.<br>
+- Entity without a unique ID: Entity ID is considered a fixed, static identifier and cannot be changed.
+
+If your user profile has the "Advanced Mode" activated, you will also see the second paragraph in the popup with a link to the [customization user interface](/docs/configuration/customizing-devices/#customization-using-the-ui) for this specific entity, which offers some customization options.
+
+In case you want to read more about unique IDs, head over to this [developer documentation page](/docs/entity_registry_index/).