According to Dictionary.com, the word "nickname" comes from the Old English "eke" meaning additional and "name" being....well name.
Now that you've learned something useful, I'll tell you why my nickname from 8th grade on is Bob.
The answer is: Nobody really knows.
Well, okay. That's a little dramatic. We kinda know. My best friend's niece was just learning to talk. She kept saying "Where's Bob? Where's Bob?" but nobody knew who Bob was. They just pat her little head and told her, "I don't know, sweetie." Until one day, I walked in the door and she said, "There's Bob!"
And thus I became Bob. Which was fine by me. I actually liked being "Bob". It gave me a sudden freedom, because I didn't have to be "me" anymore. I could reinvent who I was. And I became a little less angsty. Because let's face it, it's hard to take yourself seriously when you call yourself Bob. (Unless you really are a Bob, I mean.)
I had the same feeling when the Internet became popular. Who didn't create a new username and sort of "become" a new persona? Some people go to extremes--saying and doing things they wouldn't do if people on the other side of that monitor knew who they were--but most of us just get a little more ironic and let it go at that.
And then came my pen name. I get to reinvent myself again...kind of. Because there really isn't a lot of anonymity--especially if I manage to get published. So Wendy offline and Gwen online have to be similar enough to play nice in both playgrounds.
So, what about you? When you get a nickname, or an internet handle, or a pen name, does it give you a new lease on life?