Well to be honest I didn't even expect this thing to be an RPG. In the thread I linked to, I wrote that I was actually just playing around with expressions in DECORATE's damage parser. And then I was like "hmmm what if I made the fist do damage based on this variable". And before I knew it, I guess it has turned into an RPG.
I took a look at several damage algorithms - Castlevania: Symphony of the Night's, FF1's and FF6's (that'll be FF3 to you hehe)... but finally, I decided that I don't really need anything complex because part of the inspiration for this came from playing Ultima Underworld - I just wanted to create a simple first-person hack and slash dungeon crawler thingy. So I came up with my own algorithms which worked quite well and produced some nice numbers.
You're right about the namepos suggestion but I intend this to be a single-player only thing. I don't expect to get this to work with multiplayer (I don't think it will anyway, due to the way I'm doing the damage calculations).