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After updating my HomePod minis one of them got stuck “Not Responding” in the Home app despite working otherwise. That persisted after a restart and even unplugging and plugging back in. I eventually got it working by unplugging all my Home hubs including an Apple TV 4K and power off and on my iOS devices which I’ve never had to do. This is not any better than 16.3.
The article says to pick a recovery phrase that’s easy to remember. Apple generates the recovery code (not phrase) so you can’t pick your own. It’s not something you can remember so you’ll need to write it down otherwise save it somewhere secure offline. If someone gets the code and knows your Apple ID, they can reset your iCloud Apple ID password and effectively take over your account.