Character deletion should never be based on level. We are already second tier players as it is (can not access stash and cs, can not trade potions, can not complete more than 100 quests etc.). I knew what I was getting into, so I am not complaining about that. However I would very much dislike if I would have to log in every month just to ensure that my characters do not get deleted.

You can still obtain "reserved" names if you contact support and it turns out that the name belongs to a banned account. It costs 50 platinum though.

Anyway, I still have no idea why people worry so much about names... It is just like an ID number. Who cares if your ID is 1337 or something random like 2283. Having a cool name is only to impress strangers. Is that what you need? Confirmation from strangers that you are infact cool? You know, if you dislike your name, you can just hide it and demand from all your friends that they call you "Mr. Cool".

There is however a bright side to your idea. It would certainly help to rearrange some gold and distribute it more evenly among the players (could lead to more scams though).