Speaking with no actual knowledge on Z’s naming, there is a long history and important relationship in CPU design between the “Zero flag” (Z), and “jump” instructions.

The zero flag stores a status from the last instruction the cpu ran, which the jump cpu instructions then reference to affect what happens to code execution. This logic is the most basic form of conditionals, and underpins the implementations of higher level flow control like if statements and loops.

I’d guess that this relationship between Z and jumping is where it comes from. As for Baulders Gate I have no idea, but lean to that being a coincidence.