Naming continuity is something that'd be interesting to see, true. Some entities in the code retain a continuous name (like country names), while others are in flux.
If anything, it'd be neat if nations could change names after major upheaval, while stuff like criminal gangs stay static barring much greater turmoil. Groups that count as holding power in a city or country likely could remain as they are, as they SEEM to remain static so long as the current dynasty or power structure is still in place. Which means that if criminal gangs aren't adhering to the same standard (and I'm remembering right and dynasties DO preserve the name better than criminal gangs), it wouldn't be hard to make one consistent with the other.
That said, changing country names would ideally need some way to cite the prior name and only change it a bit, either only by a single-step change, or by having a preference towards always retaining a single central element of the name. For example Regnum Francorum, Francia occidentalis, etc (one that eventually demonstrates a shift in the preferred language used in its terminology if you follow it far enough, and one that starts early on with one entity becoming two, two things that can't yet happen in DF).
The example of deriving a name from a preceding name could also be adapted to handling family names. In the event that an entity doesn't just use a modern surname convention, this can be used to inject things like patronyms, matronyms, even compound surnames based off both parents. Though, now that I think about it...
What are your thoughts on the in-universe way the current placeholder for surnames is handled? My guess is that it's instead essentially a second given name, presumably chosen by whichever parent didn't decide their first name, or possibly a compound surname influenced by both parents in some way that doesn't yet reliably produce results logical to an outside observer, which would work very well for adapting into a proper compound surname via changing how the compound is generated.