The current grammar is awful and horrible. I was happily modding it for something better, and finally finished it - just to find the new version added hundreds of words.
I lost interest for a while, but I decided to make a new post about my project and things I learned while doing it.
First, most words used in Dwarf Fortress names are nouns, verbs or adjectives. I'll use adjectives windy and yellow, nouns beast and mace and verbs murder and craft as examples.
You might think that names would be in the format: Windy-mace or Yellow-beast; or alternatively, Beast-mace or Mace-beast, or even Crafted-beast or Murdered-mace. In reality, you're likely to get names such as Beasts-windy, Yellow-murders, Crafts-windy or Yellow-windy.
I went through all the words of the old language files, and changed the words so that almost all adjectives are only available as front-compounds; I limited most nouns to only be only singular when they are a front-compound and singular and plural when they are rear-compounds; I made hyphen-compound words very limited. It works, to an extent. You are more likely to get Bluesyrup or Spearbeasts or Coppergold than some of the worse names. However, I can't change verbs, and they are currently one of the biggest problems as far as names go.
I also changed nouns' availability as the Words of Words. The Abbey and the Abbeys are fine, as an example, but the Ant isn't - I changed it to plural-only. Similarly, of Beer is good, but of Noses isn't. Also, quite surprisingly, most of the actor (cook, hammerer, smasher, crasher) words weren't available as "the actors". I changed them all to only be allowed as rear-compounds (s. or pl.) and as the-compounds (s. or pl.), to allow names such as -cook, -smashers, the X diggers and the Y cook.
Let's think about the name "boat-murdered" for a while. It could have been Murdered-boat or Murdering-boat. It could have used a noun instead, to be Boat-murder or Murder-boat. As far as the irregular verbs go (e.g. speak, speaks, spoke, spoken, speaking), Spoken-boat is better than Spoke-boat, as are Stolen-boat and Broken-boat. I don't know the correct names for the forms of the verbs, but the examples should give you the idea.
During my project, I removed some words. It might have been a stupid decision, because it means that the modded language files won't work with existing games. However, no-one, ever, nowhere, should be named anything-proliferated, and something-bellies isn't much better.
I'll continue my grammatic project when I can gather the courage to do so, but I'd like to hear other people's opinions as well. I'd be delighted if some form of community-created language files eventually got into the Dwarf Fortress proper, because language overhaul should be done before or later, and it would be a waste of Toady's time to go through hundreds of words.
I could go on and give examples, but I'll upload the updated language files when I get to that, or possibly even the currently incomplete ones if there's interest.