They played too much WoW.

No, but seriously, calling people whatever they like is OK. As another Millenial, at least in my corner, we all had some kind of nicks and they came to real life. I have a lot of friends who still go by their nicknames from decades ago. I also changed my own name a little and am currently almost exclusively known by that name. I don't go around telling people why but my name is connected to trauma quite strongly. I can even go further in my family history to have an example of how people have been doing that always. My grandma was called by two names. She moved to the city and decided to go by another name. I was a little bit confused as a kid when my great-aunt called and asked her by a name I had never heard before. I might understand not calling someone something offensive, but Kalcifer is quite mild. In the end, it doesn't hurt anyone and is a tool for building your identity.