FNSKU is Amazon's internal identifier — unique to your seller account. UPC is the manufacturer's universal code. Amazon requires FNSKU on stickered inventory so it can trace units back to the correct seller.
If you opt into co-mingled inventory, Amazon uses the product UPC to mix your units with other sellers' identical items. This is cheaper but creates commingling risk if other sellers have quality issues.
For most FBA sellers, stickered FNSKU inventory is the right choice. It adds a labeling step at the prep center but gives you full traceability and protects you from co-mingling chargebacks.
A good prep center handles FNSKU printing and application as standard. Make sure your 3PL confirms which label type applies to each SKU before work begins.