Good post. I should pop up some popcorn for watching the conversation in Dan's post. This seems a good place for a little quieter discussion.
I've only flagged for plagiarism so far, but I have no problem with it being used much more arbitrarily. I'm in the camp that says we need to define it once more as a downvote to help remove some stigma.

I dislike when people complain about flags taking money away from them. The pending payout should not be seen as an accruing total. That number is not yours until payout time. Period. It also feels like the root of evil in terms of envy or frustration from new users. At this point I almost feel it shouldn't be displayed. Of course it would still be available if someone peers deeper into the blockchain, but far fewer people will take the time to explore every author and post to evaluate their relative position.