MID is the Experience Cloud ID similar to UUID and this is not a replacement to DPID.
DPID is your custom identifier to uniquely identify any user and MID is the device level ID which gets assigned to one browser/device when a user visits the website.
You can work with MID only when it comes to sharing data across Adobe Experience Cloud Solutions i.e. Analytis, AAM, Target and Campaign. If your website has Experience Cloud ID Service implemented then you can use MID as well to target a device and if you want to target users then you need DPID.
I hope this helps, please feel free to revert if you have any further question.
When it comes targeting via an adserver,audience manager have built in integrations with more than 200+ DSPs and these destinations are setup from the backend. We need not pass DPID explicitly.
However,when it comes to data collection via pixel calls,there are certain mandatory parameter which one must use while implementing pixel calls.Below is the document you can refer for more information: