I'm playing in HD, so I think it wouldn't be too big, at least worth a test. Also you could set a limit of how long the text is allowed to be, since in most cases you only need to see the first part of the name.
Also maybe it is better to write out the color of the player instead of changing the color of the text, it might be too disturbing with too much colors, hard to know without testing.
Thanks for taking your time Mistral and look into this, much appreciated!