Not if you adopt the idea that a commander's name doesn't have to be his legal name, and simply has to be a moniker that is unique within the Pilots Federation. They become like callsigns, nicknames... because let's face it, in-universe you are still going to have people with identical names.
This way it actually bumps up immersion when you have to choose your commander name - it stops being just part of the game and becomes a step in registering with the Pilots Federation. It's not necessarily asking for your actual name, just what you want to be known by as long as it is unique within the Pilots Federation. Given that opportunity, of course people are going to pick funny names.
The problem, of course, is that NPC names aren't necessarily unique as they crop up time and again, but if we as commanders can 'die' from a combat that went wrong, wake up at a station and decide that it's time we switched from a Type-7 to a Cobra or whatever, so should the NPCs. You didn't kill them, you just set them back a bit and made them rethink what they're doing.