It is all about How realistic is your test scripts.If 500 virtual users login with different credentials of username and password, then it will mimic the real life scenario.Login with same credentials will not.
You should use "HTTP Cookie Manager" and "HTTP Cache Manager" in your Test Plan.Using "HTTP Cookie Manager" enabling "Clear cookie each iteration" and "HTTP Cache Manager" enabling "Clear cache each iteration" will at least bring some luck for 500 VUsers using same ID and Password. In this case, every user will be assigned with different session ID and the session cookie and cache will be cleared before next login using "Same Username & Password".So though ID and Password are the same but previous cookie and cache are cleared before new login. So the result will be more accurate and realistic.It basically depends on your test script design.
Though it is always appreciated and recommended to use different credentials despite using "HTTP Cookie Manager" and "HTTP Cache Manager" in your Test Plan.