I have a question regarding the spectral theorem for bounded self-adjoint operators. The book "Functional Analysis, an Introduction" by Eidelman, Milman, and Tsolomitis says that if an operator $T$ has a simple spectrum then it is unitarily equivalent to the operator $T\varphi(\lambda)=\lambda\cdot \varphi(\lambda)$ acting on $L^2$ equipped with the measure generated by the right-continuous function $\lambda\mapsto\langle E_\lambda x_0, x_0\rangle$. Here, $\{E_{\lambda}\}$ is our resolution of identity. Hence, is this unitary equivalence to the multiplication operator only possible when $T$ has a simple spectrum, or is it possible in the general self-adjoint case? Wikipedia says that it's always true, but my functional book along with the book "Treastie on the Shift Operator" say that it's only possible when $T$ has simple spectrum.
Also, the definition of simple spectrum is when there exists an $x_0\in H$ such that $$\{ (E_{\lambda_1}-E_{\lambda_2})x_0\ : \ \lambda_2<\lambda_1\}$$ is a dense subset of our Hilbert Space. Can someone give me some intuition as to why this definition is natural.