The search you start with the match op is completed with the substitution op because they both use the same iterator (pos($file)). As a result, your match op always starts from the start of $file.

my %translations;
my %scrubbed;
while ($file =~ /^ \s+ description \s (\w\w\w\w(-\w+-\w+)) ;/xmg) {
   my $real_dev = $1;
   my $name     = $2;

   if (!$translation{$real_dev}) {
      # Make sure not to duplicate anything in %scrubbed.
      my $scrubbed_dev = ...;

      ++$scrubbed{$scrubbed_dev};
      $translation{$real_dev} = $scrubbed_dev;
   }
}

my $pat = join '|', map quotemeta, keys %translations;
my $re = qr/$pat/;

$file =~ s/($re)/$translations{$1}/g;
[download]

If you just want to change the device description instead of every occurrence, I suggest

my $output = '';
my %translations;
my %scrubbed;
for my $line (split(//m, $file, -1)) {
   if (
      my ($pre, $real_dev, $name, $post) =
         $line =~ /^ ( \s+ description \s ) (\w\w\w\w(-\w+-\w+)) ( ; .
+* ) /xs) {
   ) {
      my $scrubbed_dev = $translation{$real_dev};
      if (!$scrubbed_dev) {
         # Make sure not to duplicate anything in %scrubbed.
         $scrubbed_dev = ...;

         ++$scrubbed{$scrubbed_dev};
         $translation{$real_dev} = $scrubbed_dev;
      }

      $output .= $pre . $scrubbed_dev . $post;
   } else {
      $output .= $line;
   }
}
[download]

THANKS!!! I knew I was overlooking something obvious but just couldn't see it!!

Update1: Thanks for the second snippet, but the device names appear at least twice. And I need to use the full names because sometimes the 4 character sequence will match something unrelated in the config file. Didn't think scrubbing this data would be such a pain! :/

Update2: Yep, I did miss it! Thanks for the help!!

Elda Taluta; Sarks Sark; Ark Arks

And I need to use the full names

I used the full names. You might have missed my change to smarter capturing.

You: / ... (\w\w\w\w)(-\w+-\w+) ... /
Me:  / ... (\w\w\w\w(-\w+-\w+)) ... /
[download]

Turn your while into a s///eg

$file =~ s{^\s+description\s\K(\w{4})(-\w+-\w+)(?:=;)}{ 
    my $prefix = $1;
    my $suffix = $2;

    # Optional Transformation logic here, giving $prefix and $suffix n
+ew values.
    
    $prefix.$suffix
}mge;
[download]

I added the reset later, with no effect. And how would I change the while m// to s///? I need to find what I am substituting first, right? I did update my_rand to deal with duplicates (will update code above).

Update1; Oh, put code within the substitution!!

Update2: How do I get it to loop? :/

Elda Taluta; Sarks Sark; Ark Arks

if you just want to replace the first occurance of a name, then use the following

my %new_names;

$file =~ s{^\s+description\s\K(\w\w\w\w)(?=-\w+-\w+;)}{ 
    my $name = $1;

    if (!$new_names{$name}) {
        $name = $new_names{$name} = my_rand();
    }
    
    $name
}gme;
[download]

Or if you want to replace all occurances of a name with the new name, then the following would work:

my %new_names;

$file =~ s{^\s+description\s\K(\w\w\w\w)(?=-\w+-\w+;)}{ 
    $new_names{$1} //= my_rand();
}gme;
[download]

Note: since the suffix appears to not be relevant, I added it to the positive look ahead assertion.

I'm not sure why you think you need to slurp the file:

use strict;
use warnings;
use 5.010;
 
my $str =<<'ENDOFSTRING';
       unit 53 {
            description 1234-rwan-1;
            vci x.yy;
        }
        unit 54 {
            description 45ff-rwan-1;
            vci x.yz;
ENDOFSTRING
 

open(my $INPUT, '<', \$str)
  or die "Couldn't open string for IO: $!";
  
while (my $line = <$INPUT>) {
  if ($line =~ /^
               \s+ description \s
               (\w{4})
               (- \w+ - \w+);
              /xms 
  ){
      say "$1 <=> $2";
  }
}

--output:--
1234 <=> -rwan-1
45ff <=> -rwan-1
[download]

My apologies. I should have made it clearer, but I thought the comment "# Should only be processing each name once!" would suffice since it implies names can exist more than once. In fact, pretty much all of them exist at least twice. If they only existed once this would have been easy!!

Elda Taluta; Sarks Sark; Ark Arks