The Z thing is killer. It puts you in company with http://en.wikipedia.org/wiki/Horsez, http://en.wikipedia.org/wiki/Bratz, and numberless rappers, none of which make a professional impression.
Fogbugz is a terrible name and if an unknown developer had released it there's a good chance too few people would have looked at it for it to get the necessary traction it needed to succeed. It really isn't an example of something people should follow.
"Ve still neet a buck trecker, I vas finking about Jira, or do you haef a better idea?" "Yes, I recommend FuckBugs!"
In BrainFuck.
"Yeah, it's not an ideal name... But the brand equity is already worth significantly more than the cost of having a yucky name... (There was a period for about 6 months when "Z" was all the rage. Antz, Dogz, and Atomz come to mind)."