It's an ID code for the disc used to install Windows on the machine. It's not the "CD key" which you have to enter during the installation, but it IS a unique ID 'name' for the specific install disc that you have.
In other words, it's a publically viewable unique ID for your Windows installation.
Are there any other ways of uniquely identifying an installation of Windows? Possibly identifiers that would change from installation to installation even using the same Windows XP CD?
The only thing that would provide you with a different ID is a different key. All copies of, say, Windows XP Pro SP2 have exactly the same files(file names, file versions etc). The only thing that sets them apart is the installation ID, which is generated using the CD Key used to install Windows. Hence, you could install Windows on 2 machines with the same key, they would have the same installation ID.
To clarify, is there a method of uniquely identifying a computer that would no longer work after Windows was reinstalled?
Why wouldnt a computer work after reinstalling Windows?