I do DNS for a large enterprise.
We have a subdomain just for user-friendly names.
Only CNAMES or A records pointing to a load balancer are allowed.
Outside of those two rules, I don't give a shit what name you want. If you're the first one to grab it, and it is in a request that ties back to you so I can tell them who asked for H4X0R.user.domain.tld, you can have all you want.
But yeah, I agree. Places that don't allow this are jerks.