That sounds like the latest initiative to keep out banned authors and spammers.

There is nothing in the quote which says they will be asking everyone for it, just "may be prompted".

That suggests to me that when suspicious activity is going on, they want proof that the person is who they say they are.

It also suggests that identity theft has become an issue somehow.

https://www.kdpcommunity.com/s/article/Identity-Verification-for-KDP?language=en_US&forum=KDP%20Forum#top

KDP is committed to providing legitimate authors and publishers with a trustworthy, enjoyable publishing experience. In order to further protect that experience, we’re introducing Identity Verification for KDP. Beginning today, KDP authors and publishers may be prompted to submit a photo of their government-issued identification which we’ll match against their current account information. We take privacy seriously, and we handle personal information in accordance with Amazon’s Privacy Notice and delete all identity documents after the ID verification process is complete. Once the match is confirmed, authors and publishers will be able to proceed with using their KDP account.

Also, Matthew pointed out the help page for the ID verification, so I've added a link to it.
https://kdp.amazon.com/en_US/help/topic/GH7TYHP6FR9QAUM9

Nope, it's still live:
https://kdp.amazon.com/reports-old
Then again... maybe it isn't. Perhaps that's the issue.

We must have talked about this before? Don't know. Well, there's the old KDP reports and the new one. Turns out the new Kindle Direct Publishing reports says I sold books yesterday and the old reports only reports nothing. I toggle back and forth because it's unreliable, but over the past year, it's been pretty consistent. Just to let everyone know in case you're running a big sale for data, or watching ad data, this is the first time in a long while I'm seeing a long lag with old KDP reports. It used to happen all the time. Are they finally fully discontinuing the old reports? I hope not 'cause the new KDP reports kinda sucks, imo.

I was eager to try those because Amazon said ads with images other than products got better results.

I've tried both single images and multiple ones (which produce a slideshow). My results are worse than with the old sponsored brand ads.

I selected keywords carefully and checked daily to deactivate nonperformers and put some actual customer searches in the negative targeting area. Results didn't improve.

Is it a mistake to use the keyword targeting? Would product targeting be better?