Just for the records, I have been following this topic and I am really quite amazed about the outcome so far. The new flag Model is absolutely fantastic! Two suggestions I would have:
1) The visibility of the FC is absolutely essential. Maybe something can be done with some kind of glow or corona? Or with a very bright red/blue light ball in the center of the flags? I also like the idea of the smoke trail, but I don't know how much this would affect server/client performance (if at all) and what happens to it in the various detail settings.
2) The flag model as such is pretty and fits with the style of Nexuiz and all, but when someone is carrying it, I feel it looks somehow odd that it just "is" there, without no connection to the flag carrier at all. I know how difficult it is to keep the flag somewhat within the bounding box, but I'll say that IF it is possible to change the flag model upon pickup/drop event, then it could transform into some kind of backpack with the three flag thingies sticking out of it. I know Nexuiz abandoned realism long ago but regardless of realism I think that might even look good.
These are just my two cents here, since Doku said you needed some more input. It's rather brainstormy and not really thought out in all details but anyway.