The best way i've found to describe Urbit as a product is a decentralized, open source version of WeChat. No, nobody really cares about privacy, but I think the argument is that for the consumer there is the potential for a way better experience. If all of your data is in one place, as a consumer, you only ever need to enter it once. More interestingly, all of your apps can work together in a seamless way that's currently impossible with the current paradigm. Your maps app has ubers and lyfts driving around on it, with yelp/opentable postings on all restaurants, etc.
On the developer side, you save so much time not reimplementing identity, payments, reputation, etc., everytime. There are more reasons why Urbit is better for developers, but I won't go into them here. Checkout the whitepaper...it's a little dense, but there is logic there:
Now, to your question. WeChat won at chat and once they owned communication / identity, it was fairly easy to move into payments and everything else. Urbit has a classic chicken & egg problem: its tech is designed to be better at doing everything for everybody. The current stack is already much more robust and better suited than urbit for most if not all one-off 'killer apps.'
So, you're right, they need to find the first killer app, equivalent to WeChat's 'chat'. I've been following the project for years, and the answer to this question has eluded me. However, recently, I finally heard the first solution which felt like the completely right solution to me, and I believe they're pursuing it.
Yes, some of the language is pompous and unnecessarily 'verbose'(being generous). Yes, they could do a better job explaining the problem in laymen's terms. However, I can tell you that the people behind this project are very intelligent and very serious. And, of course a little crazy..but you have to be a little bit to attempt something on this magnitude...right?
The whole reason Urbit exists is that Unix + the internet is broken and needs a complete overhaul
Re: the different names, there are slight differences between gates and functions, but I agree they're not important enough to merit the change in name. But hey, it takes a purist to spend 15 years rewriting the whole stack from scratch!