I think my confusion is due to a recent change in the ID description/rules:
"ID: Xenos (No tractor beam)
Allowed: Participate in military operations on unlawful side, hunt lawfuls and bounty hunters, attack anything in sight.
Not allowed: Trade on regular basis, ally with lawful forces, demand or tractor cargo.
Allowed ships: Fighters, Freighters, Gunboats"
I believe it USED to say that terrorists had to demand money before shooting. Ok so Xenos and other terrorists are allowed to shoot anything in sight, and aren't like pirates at all because they can't tractor or demand cargo (or money?) But by using a xeno or phantom ID while playing as a nomad, you still just look like a xeno or phantom flying a nomad ship...compound this issue with the fact that you will probably be flying with an odd affiliation tag and you see why the nomad ID is so necessary.
Again I ask, if the nomad ID is to be distributed by an admin, where is the danger of this being abused? Koolmo, "old boys club," I think I know what you are saying. You mean you are afraid of seeing all of the server elites/high-roller club being the nomad players exclusively, ganging together in packs and leaving their other characters to gather dust? (sorry, but I see Scythe doing this a little..glad to see Dab wanting to help the KNF out though...If all of us could play this server with that sort of eye for balance, PvP wouldn't be such a devisive issue here.) This is a genuine concern about the idea, and the solution to it is honest and forthright regulation of the nomads by admins and server rules.