Earlier quoted context omitted.
This is confusing when you know that NULLs are not comparable, but it makes some sense if you consider the result of distinct/union as the output of a GROUP BY. You can consider everything that's NULL to be part of the same group, all the values are unknown. So NULLs are not comparable but they are part of the same set.
If nulls are distinct then group by should not group them together, this just ignores the problem. Why does group by treat them as equal?
I believe this confusion is confusing the tool with the thing being measured. For simplicity, I will use the analogy of a record (stored as a row in the database) as an observation in a scientific experiment. If the tool was able to record a value, I enter a value like 579.13. If the tool was not able to record a value, the tool will enter NULL. I make a total of one hundred observations. Of one hundred rows, some have values and some are NULL.
Are NULLs distinct values? No, they are simply a failure in measurement; it is like asking if all errors are distinct or the same. Are NULLS part of the same dataset? Yes, because they are all observations for the same scientific experiment. What does it mean when "select distinct ... " returns several rows for known/measurable values and but only one row for NULL? If this is confusing, the scientist can update the rows and substitute "UNKNOWN/ERROR" for every NULL. When you do "select distinct ...", you will get the same thing. It will return several rows for known/measurable values and but only one row for "UNKNOWN/ERROR".