Can this action be performed as part of configuring an application definition in IdentitylQ?

Yes, defining account correlation via a rule is an action that can be performed as part of configuring an application definition in SailPoint IdentityIQ. Account correlation rules are often used to determine how accounts from different sources are linked to identities within IdentityIQ. These rules allow for complex logic to be applied when matching accounts to identities, beyond simple attribute matching.

SailPoint IdentityIQ Administration Guide (Section on Account Correlation)

SailPoint IdentityIQ Application Configuration Guide (Using Rules for Account Correlation)