PID control behavior with respect to Sensor Mode

I don't quite understand under what circumstances the PID controller is used (specifically talking about FOC control in my case).

I've got encoder feedback, but thus far I've actually had better results from running Sensorless (by keeping the 'Sensorless ERPM' setting lower than my min ERPM). I guess this means the encoder info is taken into account for start-up only, but then it quickly switches to Sensorless mode?

My main question is, are the PID Controllers used in both Sensorless and Encoder-feedback modes? If so, should a given set of tuning parameters work well in both modes?

In my application, my goal is constant velocity control so I'm wondering if one or the other Sensor Mode would be better, or if I can get a velocity control loop with either.