Since the DEK is stored as part of the VM configuration file, it is important that the file is kept safe. Losing the DEK means that the data stored in the VM is lost irrecoverably. Having complete and up-to-date backups of all data related to the VM is the responsibility of the user.
The VM, even if it is encrypted, may contain media encrypted with different passwords. To deal with this, the password for the VM has a password identifier, in the same way as passwords for media. The password ID is an arbitrary string which uniquely identifies the password in the VM and its media. You can use the same password and ID for both the VM and its media.