I've got the PSX version, and same as before, only five letters are available. I know, because yesterday I started a new game + (refamiliarizing myself with the enemies), and I was able to successfully name Marle "Mario", Lucca "Velma", Frog "Cyrus", and Robo "R-66Y" (Yes, I LOVE screwing watching my naming masterpiece as I laugh hilariously at the dialogue)
When I get to Ayla I'll name her Kino, and Maybe I'll name Magus "Lavos". Yeah... point is though, it was a perfect fit. That's all I could get in.