What you are referencing sounds interesting. Would you please provide a link with more information? Googling "nickle matrix" does not yeild useful results, and it's even worse for "nickle element"
Nickel is one of their existing plans, and Home is their new plan. Both offer the same features, except that Nickel offers an ability to use custom domains and is aimed at businesses. More on their pricing page [1]
It looks like Nickel is $2/user, with a minimum of $10. So for a family a fixed $10 is probably the smarter choice, rather than to have $2 more for every user added. EDIT: it seems Home is limited to 5 users, which means it's actually the same price.
May i ask what would be the benefit of having your own DNS? I don't understand what your average group chat would gain...
Owning your domain has the same advantage for element than it would for, for example email. If your company has their own domain for email, but hosts at Gmail, Google can one day decide to kick you off their platform. But, because you have a domain, you can take your business somewhere else.
On the flipside, if your email and personal identity is tied to an @gmail.com address, you are stuck at that vendor.
A second reason is vanity. Full matrix usernames and channels do appear from time to time, and it's nice when it's our own address. (we self-host matrix)
As some of the others have said, custom DNS is largely for vanity and discoverability reasons. People know that they can find your website on your domain, why not chat to you on Matrix there too? :)
In addition to that though, there's also the aspect of being able to choose to host your homeserver on your own infrastructure, using your own domain, should you want to.
In Matrix your homeserver (domain) name is "baked in" to every event created by your homeserver, which means that you can't change it after setup. If your homeserver is set up on, say, "foo.ems.host", you can take a snapshot of the data at any point but you couldn't just set it up to run on your domain. If you start hosting with your own custom DNS pointed at EMS then you can take over and host on your own infrastructure at any point.
As mentioned in this thread, Element home is intended to make it as easy as possible for people to get up and running with their own Matrix homeserver. To do this we've really reduced the number of configuration steps in initial setup as much as possible, including hiding custom DNS setup which can be quite complicated.
This won't be a problem for most people, but if you're interested in custom DNS (and want EMS to host it for you), you'd probably want to start with the EMS Nickel package, with custom DNS, rather than Element Home.
It's worth noting that we're currently working on "account portability" which would allow you to decouple homeservers from specific domains. So, once this is available you should be able to change domain names etc. at any point.
I think that you've got it already, but just to clarify the pricing, the costs and constraints for Nickel and Element Home hosts are the same - $10 per month for up to 5 active users. Additional users can be added at an additional cost of $2/per user/month.
The primary and only advantage that I can think of is, personalized addresses. It's better to have one's address as `@james:potter.family` instead of `@james:potter.ems.host`, where `potter.family` is my custom domain.
[1] https://element.io/pricing