When developing this code, I used the newly released Visual Studio Extensions for Windows SharePoint Services (VSeWSS), which has several issues. One of them is the way it generates GUIDs behind the scenes, which makes it difficult to make changes to the supporting files.
The setup.bat file in the ProposalManager solution is generated by VSeWSS, so editing it directly might not always work. It also assumes that the feature will be recreated and deployed together so the ID must match the generated GUID. If they don't match, then you will see this error.
Another approach is to make a copy of the setup.bat file and then change the activatefeature and deactivatefeature commands to use the feature name instead of the ID that VSeWSS generates. Then you will have to run the custom setup yourself, either by using a post-build action or a custom MSBuild target.
It is true that the Site Definition identifier must be unique, so you'll simply have to determine what works in your environment.
John F. Holliday, MOSS MVP