Are the capabilities of Namecoin a strict superset of Bitcoin? I have read that "while Bitcoin is a currency, Namecoin is not".

Isn't the capabilities offered by Namecoin a superset of Bitcoin's capabilities? If everyone in the world agreed to jointly migrate all Bitcoin to Namecoin at some instant, would we lose anything from this migration?
The amount of NMC required in order to register a domain name is fixed by the protocol.

Having NMC and BTC be separate currencies ensures that the number of BTC needed to register a domain name is set by market pricing mechanisms, not by the hardwired protocol.

If we used NMC for buying and selling things other than BTC, it would be like denominating all of our economic activities in terms of domain name registrations ("this pizza will cost you 0.012 domain name registrations").  This is a bad idea because the demand for domain names would indirectly influence the price of everything else in the economy.  It's the same reason why the precious metal with the fewest industrial uses is the best one to use as money.

This is why I think that any non-Nakamoto-blockchain currency with a significant use other than currency doesn't detract from the value or usefulness of the Nakamoto chain.  The fact that they can be used as something other than a currency makes them really poor currencies.  The fact that it's easier to exchange them for BTC than for fiat actually slightly increases the usefulness of the Nakamoto chain.  But of course all of this applies only if the alternate chain has a credible non-currency use.  So far I don't know of any other than NMC.