Kinarr created ours (I think), so he's the best person to answer most of your questions. It works great, but there are some issues to be aware of (from Bioware, not Kinarr

).
1) Any chat will do the renaming. Talk, Party, DM, etc. This can at times be hilarious or frustrating. Like having a raccoon's floaty be, "Hey, what's wrong with that raccoon?"
2) Saturday I discovered that entire stacks can be renamed in one shot, and when you add a non-re-named item to the stack it also gets renamed. This made me very happy as DM since I was afraid that I was going to have to split every single item from the stack to rename them. However, it's also an exploitable since if a DM drops a renamed gem, potion, etc. then the player can run around renaming every instance of that item (the same name).