Currently, the compact nameplates option ("icons only") is completely useless because it shortens everyone's name to "ale", "bro", "yan", "ALu", "W h" and so on, except for the one or two VRC+ users in the lobby who instead have pictures of their own avatar that you can already see if you look down.
Being assigned the name "ale" and only being able to change it to an icon if I pay $10/mo makes me feel like I'm being dehumanized.
As a solution, I suggest adding an option where all users can choose their own alias of up to 5 characters or so, and show that when the "icons only" mode is enabled. For aliases longer than 3 characters, a more compact font could be used to make the name fit without having to expand the nametag too much.