"Using public keys as the primary identification method works because we have ways to alias them to readable names" is unchecked. Client software can prefix a nickname to every post it creates. Clients can use
@nickname to message any unique nickname in their feed or followers list and the client will map it to the corresponding pubkey. If two people in your feed have duplicate nicknames, when you try to message one with @ your client will prompt you to modify the nickname for your client only. It will thenceforth display your modified nickname for that user but, when you send them a message, it will change it to the correct one behind the scenes so that the recipient and his friends will see the nickname they expect.