The in-game chat box is handy. However, not all of us are avid computer geeks that can read at 400 wpm on monochrome irc clients or shell prompts.

Some extra information for separating text into understandable chunks (such as colors and bold/italics) would go a long way to helping people see the information they're interested in.

Names in chat
Players chose their personal colors when they made their character, so let's use them!! Colored names help separate the chat into sentences from specific players, so you can tell where one player's sentence ends and another player's sentence begins.

This is especially helpful when one sentence is longer than one line, and the chat suddenly shifts upwards by arbitrary amounts. In those cases, it takes me several seconds to find the line I was reading again, and by the time I've found it, the chat jumps up by several lines again! If there were colored player names, I would just look for the color of the player I was reading, which is much faster than reading everything in the chat box again. Even if everyone in the room has a red name, it's very handy for telling the difference between sentences that are two lines long, and sentences that are three lines long.

Addressing other players
It's great that tells are a different color from main chat. But tells are private. Sometimes, players hold discussions involving groups bigger than 2. Sometimes, players will jump into a discussion that's already happening, and it's not always obvious that the new name is talking to you. (I've been ignored on several such occasions, even after saying things like "Hey, <player name>. I'm selling the item you're asking everyone for." It's depressing.)

The first level of change in this category is client-based. As you play, if a player says something that includes your name in it, that entire line gets highlighted. If it's someone else's name, you probably don't care as much, so it doesn't need to be made special. (Bolding the line is a possibility, but I have a feeling this will still be ignored.) If I type your name in my sentence, I want your attention, and it's probably to your benefit to listen and respond. I'm hoping players don't abuse this, but if they do, it's nice that the developers have given us /ignore.

The second level of change is slightly more open to abuse, and is more computationally intensive. If a player types a sentence, and someone's name is in that sentence, regardless of whether it's yours or not, it gets highlighted in that user's color. Because user names can't have spaces in them, you can check each word individually to see if it matches a pool of user names. (Or you could do fancy things with GREP.) The size of the name pool should be considered; it may be all players on Haven 8, for example, or just all players in this particular Bazaar. This level of change may crop up issues if a player's name happens to be a common word (like "Gimme", "Items", or "Plz"). Those names aren't against the user name rules (which makes them valid choices), and I certainly don't want the user name rules to be changed to deal with this feature. I'm just putting this idea out to see how the community likes it.

Zone and Trade colors
It's nice that zone and trade channels are a different color from normal chat. However, since they're the same color as each other, they just end up being "all chat that doesn't happen near you". It would be nice if Zone and Trade had different colors from each other.

I'm not in a guild (so I can't verify if it's not already the case), but I think guild chat should also have its own colors.

Chat box height
I like how you can click on the chat box (to aim at a block with your hand gun in that direction, for example), without your mouse click getting eaten up by the text area. Essentially, the chat box area doesn't interfere with regular game play.

For those of us who follow channels, or those who slaughter monsters and pick up drops for an hour before looking at the chat box again, a taller chat box would be really handy for catching up on missed lines or comparing texts from different players. Also, with the addition of colors for making the text easier to read, we can handle more text at the same time; bigger chat boxes would probably be okay.

I don't suggest that you make a click-and-drag edge for the text box. Players might accidentally click that in combat. Adding another button to the "scroll up, scroll down, scroll to bottom" buttons would make that area far too busy and hard to understand for new players.

I would suggest putting this in one of the options tabs somewhere. Or, since it's an advanced feature for advanced users, you could set up a text file in the install directory that we could edit ourselves. I'm sure advanced users would be able to find this file and work with a custom text syntax. (Just remember not to "reset" this file after every patch like you do with character and ui texture files.)