On Peragus Mining Facility EUROPE server, my legacy name is Dovahkiin. No word of a lie. I'm on another server trying to get Potter for my character, who is called Harry.
I usually show it as 'The Dovahkiin Legacy'.
As for what legacy is, I heard it's basically an incentive to make new alts. I heard it will unlock things like new races for you to make characters with, or perhaps new social abilities or racial bonuses.