At a high level, it really shouldn’t matter much in this day and age. Personally I only go above 1000UPM if the design calls for it. Microsoft recommends a UPM value for TTF files that is a power of 2, but I think it’s safe to ignore this guidance
That is not wrong. It means if you just change that value, and don’t scale the rest of the font, The apparent font size will change. That is a good way to adjust the rendering size (e.g. to match it to other fonts).