Damn Blogger for not being a forum. Rather than bury my replies to yesterday's comments, I'll make them into a post.
If you were legal under copyright law, but they send you a C&D anyways then they could do the same under the OGL. You're just operating under contract law now instead of copyright law.
I'll take my chances with a tightly worded contract that they've provided an FAQ for, rather than the poorly understood murk of copyright law, especially across national boundaries (I'm a US citizen living in the UK), especially in the realm of games where very little precedent has been worked out.
What words or concepts did you use that you feel put you at risk?
It's not any one or two or three, it's a complete game product that pretty much uses all of them, and that's all I was going to put under OGL. I'm not talking about trademark law here, of course, I'm talking about what would count as a "derivative work" (standard copyright law) rather than a "novel extension" (the Super Add-Ons precedent).
This is a not-for-profit, non-commercial fan work that mentions some terms and concepts from D&D in ways that are believed to reside within the bounds of “fair use.”
Indeed, you do sign away your right to nominative use with the OGL. I can live with that; people are familiar with the coy work-arounds by now. But I'm not sure any statement can make a retro-clone or complete houseruled game into "fair use" (see here). At issue is whether the use of all the game terms from D&D together constitutes a particular expression of an idea even if the exact words to describe them are different.
...either you create something completely original without a trace of SRD to it or you will be in violation of the OGL.
So you are saying that using the OGL for one work binds you to use it for all? Seems to me that if you don't accept the contract you take your chances with copyright law and the fair use doctrine. Based on precedent my impression is that an "add-on" that uses the terms from the game would fall under fair use but a derivative work that attempts to do exactly what the SRD is doing would not. Of course, if you do include the license then you have to make sure your use of the SRD is kosher.
This is the crucial issue for us all I think - to what extent the terms in the SRD are covered by copyright, as opposed to their precise expression as game system. If you rework the stats to give different effects, be generated differently (or at all - the SRD does not cover character creation, a gap that was put in there to cripple it as a complete RPG), but you use five out of the six names, would that be fair use or a derivative work? The Wizards FAQ refers to a stat block as one of the elements of the SRD: is it the concept of a stat block (I doubt it, too much prior art), a stat block with some of the terms but working completely differently, or a stat block with all the exact terms as laid out in the SRD?
Example: Game mechanics can't be copyrighted, but under the OGL you control it's fate. You have opted out of the standard copyright and secured the material inside a contract.
If you put those mechanics under Product Identity. And you have only secured them to the extent that other people use that contract.
Under the OGL you can lock it down under Product Identity and if someone uses the material then they can be sued due to license violation.
Even if they never signed up to the OGL? I don't think that solves the problem.