Facebook here is giving people something they expect on any other service - MySpace, Google, LinkedIn, etc. Creating a barrier to entry would have stood in the face of the democratization of social media. That customized names were needed at all was a design flaw. That they made it a PR coup was brilliant. That they left revenue on the table was a smart business decision.

As an aside, it wouldn't have been anywhere near $3 million. I'm sure a large number who did it enjoy the bragging rights and badge of honor, but it's not something they'd pay for.

There's more discussion on Scott's blog, so check it out.