There's much controversy surrounding the classification of DID: it used to be listed under Hysteria, then under Amnesia, now there's debates on whether it should be under Post-Traumatic Stress Disorder. Mental health community has disagreements on the cause of DID and the appropriate treatment modalities for it, but nobody disputes the fact that there are patients presenting with DID symptoms, that these symptoms can cause them significant impairment in functioning, and, if so, require treatment.
Statistics range between 0.01% and 7% of population, depending on how you count. For comparison, depression affects 6.7% of americans, diabetes - 8%, asthma - 7.4%, alcoholism - 30%, autism - 0.01%, OCD - 2%, PTSD - 7.8%, bipolar disorder - 2.6%. So DID is somewhere between autism and depression.
Some people believe that DID, schizophrenia, and bipolar are essentially the same, and that anyone who has either of these conditions is a danger to society This myth has more to do with misconceptions surrounding mental illness overall than DID in particular. In reality, mental illness and insanity are two separate concepts. According to World Health Record, 25% of people worldwide are affected by mental or neurological disorders at some point in their lives. According to the National Institute of Mental Health, insanity defense is used in less than 1% of cases, and isn't always successful. As for all mental health problems being the same - the current DSM (Diagnostic and Statistical Manual of Mental Disorders) lists approximately 279 different disorders. Schizophrenia is a thought disorder. Bipolar is a mood disorder. DID is a dissociative disorder. The three have very little in common, and neither of them automatically makes you insane. It's kind of like saying that asthma, diabetes, and osteoporosis are the same thing because whoever has either of these is a cripple: insulting, and not true.
Dissociation is a spectrum and all people dissociate to one extent or another. However, DID stands for "Dissociative Identity Disorder", i.e. the extent of dissociation experienced by the person with this condition is beyond normal healthy fluctuations, and causes them significant impairment in functioning. This impairment is one of the required diagnostic criteria, i.e. you can't be diagnosed with DID if you aren't experiencing it. Some people with DID don't don't feel their condition is causing them any inconvenience and don't like to be labeled mentally ill. However, arguing that something called "Dissociative Identity Disorder" is not a disorder makes for very confusing conversations, especially since many people do in fact feel that their condition disrupts their life, and want help with it. If you're talking of something other than DID, i.e. the disorder listed in DSM under code 300.14, it would make sense to use a different term, for the sake of clarity. For example, "multiplicity" might be a good alternative.
Many mental health professionals believe that DID is caused by early childhood trauma. The type of trauma can vary: abuse, natural disaster, war, hospital stay, etc. Whether a child develops DID or not depends on the impact of the trauma and on the child's resilience: a healthy and happy child with a great support network will be able to withstand more than a less fortunate one. Many children experience severe trauma but don't develop DID. Having DID doesn't prove that you suffered "worse" abuse than others, just like committing suicide doesn't prove that your life is harder than lives of other people - it only proves that it's more than you can cope with.
Some mental health professionals believe that DID could be iatrogenic, i.e. caused by therapy in adulthood rather than trauma in childhood. There was a boom of dissociative disorders around 1980s-1990s because back then therapists used modalities which encouraged dissociation rather than curing it (e.g. hypnosis or Internal Family Systems). Psychology is a young science, and mistakes do happen sometimes. Most therapists use different modalities now, but the people who were harmed in 80s-90s are still in therapy, battling a condition that was worsened (if not outright caused) by previous therapy. However, DID also exists in clients who were never exposed to those modalities; the first documented case was that of Jeanne Fery, 1584. Thus, while some cases of DID might be iatrogenic, others must be caused by something else. Whatever the cause, someone who has DID deserves help and support, and should not be blamed, shamed, or ridiculed for their condition.
Some people attempt to gain attention by malingering various disorders, e.g. gluten intolerance, cancer, or DID. There are no blood tests to confirm or deny mental illness, but faking it isn't any easier than faking fluent Mongolian. Mental health professionals successfully sort through these issues and provide appropriate treatment for whatever condition the client presents with, be it DID, one of the cluster B personality disorders, factitious disorder, or anything else. Outside of therapy, the diagnosis rarely matters because it doesn't create any special entitlements. Some people with DID are shy and considerate, others are annoyingly dramatic - we come in all shapes and forms. Those who are needy, manipulative, or otherwise intolerable, face social rejection regardless of their diagnosis, and claiming DID (real or imagined) doesn't make them any more likeable.
DID receives a lot of media attention due to its controversy, so it's understandable that some of the younger folks find it fascinating and want to explore the concept. Most people can recognise different aspects of their personality, and it can be fun to name them, draw their portraits, write fiction stories about their adventures, etc. Split personality anime is particularly popular: elves, kittehs, cute toddlers wearing oversized mary jane shoes, etc. There's nothing wrong with creativity, but it's crucial to differentiate between a hobby and a mental health condition. The young artist engages in these activities because it's fun; they can create as many characters as they like, edit them, scrap them and create new ones, or abandon the project and take guitar lessons instead. Someone with DID, on the contrary, is not choosing to have it; it's causing them serious impairments, and they can't make it stop at will.
People who never heard of DID sometimes describe it as demonic possession: some external force took over you and made you do things you later cannot explain and have no recollection of doing. Such experiences can indeed be confusing or even frightening, but they aren't caused by anything external, and have a logical explanation. Dissociation involves detaching from some of your experiences, thoughts, and feelings because they are too painful to deal with. They stay bottled up inside, and occasionally burst out. There's nothing sinister in there, it's simply old pain that needs to be healed. Psychotherapy can help you become aware of it and process it, so that such incidents would stop. It takes time, but is doable.
In legal and physical sense a person is a sum of their alters: they share the same body, passport, and responsibility for each other's actions. It's similar in psychological sense too. The purpose of dissociation is avoiding intolerable situations by spacing out and letting another alter take over and handle the problem. As a result, neither alter develops the skills to handle the full spectrum of life. One can have great assertiveness, but fear friendships. Another can be good at bonding with people, but unable to handle conflicts. They complement each other, and the system overall can be functioning well, but each separate alter wouldn't function as well on their own.
Alters are psychological entities, so they can't have physical characteristics by definition. Physical characteristics apply to the physical body. However, some people speak of their alters having unique physical conditions, e.g. one of their alters is allergic to cats while others aren't. It can be quite confusing, but has two explanations. First, it's possible for alters to be unaware of the fact that their body is allergic to cats: whenever they get close to one, the alter who is aware of the allergy takes over and deals with the allergic reaction, so other alters can remain blissfully unaware. Second, it's possible for DID to be comorbid with somatic symptom disorder, where you experience symptoms of a physical illness without actually having it. The body is not allergic to cats, but one alter believes they are, and actually starts sneezing. Somatic symptom disorder can be resolved with therapy.
If illnesses were easy to diagnose, there would be no need for doctors. Even a common cold can present differently: it might start with a runny nose and develop fever later, or it might start with fever and progress to sore throat, skipping runny nose entirely. DID is a more complex condition than a common cold, and each person with DID can present differently at each point in time. Some experience time loss on daily basis and admit it to their friends - others experience it rarely, are unaware of it, or simply keep it to themselves. Additionally, people can be moody and absent-minded for a multitude of reasons besides DID. If you feel your friend needs professional help, you can suggest it, or wait till they decide to seek it on their own terms. They might be seeing someone already, and simply not wanting to update you on it. Playing therapist with your friends damages the relationship and doesn't help them any.
Memory loss that comes with DID can negatively affect relationships, employment, time and money management, etc. It's inconvenient, and most people with DID want to do something about it. Some wish to get rid of their alters; that's impossible, just like it's impossible to get rid of your anger or sadness. Others hope to merge all alters into one. Yet others want to keep who they are, but establish co-consciousness and cooperation, so that there's no memory loss and all alters work as a team rather than pulling in opposite directions. Both of these choices take time and effort, but eventually result in improvement of quality of life.