ID is a representation of posts coming from a single IP. It can be your home IP if you post from home, or your mobile's IP, or if you use VPN then the IP you get from that service.
The ID cannot be "translated" to IP. So even if someone collects it, he won't be able to tell what was the IP.
The board software first hashes the IP, so IP doesn't appear anywhere on the site, not even on the moderation pages, just the hash. And I assume the ID itself is created to that hash, and not the IP directly.
No tracking is possible. If you were post on another board with ID enabled, you'd get a different ID, even with same IP.
IDs just a way of establishing identities for posters per board, maybe a way to help to counter samefagging.
It is optional for every board to use them. Board Owners can decide to turn them on or off, similarly with flags.