That rule is for 'ordinary' people/users. Certain 'special' people are exempted from this, and are allowed fictitious names.

I would expect they mean special people with well-known stage names like Madonna, Sting etc. similar to how Quora enforces it. But I guess if Larry is making the rules he gets to decide if he is special enough :)

Are you sure? How do you know?

Put this in your favorite search engine: thomas hawk pseudonym

I use a pseudonym on Google+. It's explicitly allowed (although mine breaks the rules), even though they keep locking and deleting people's accounts for using them.