What is the name of this protocol? Can I interact with people using other chat programs, like Pidgin on linux or Adium on OS X? Which programs recognize it, and which don't?
Empathy uses Telepathy connection managers for each protocol it implements; "People nearby" happens via telepathy-salut, which in turn mainly uses link-local XMPP. Pidgin, Adium and iChat should support it, among others.