That's because they are a webhosting company, not a domain registrar. They offer domains at a cost-covering price as a service for their webhosting customers. Technically ns.phx1.nearlyfreespeech.net works just as well as ns1.yourdomain.example, but the latter one requires manual work (adding glue records) because their control panel does not support it.

Thanks for pointing that out. I had no idea that this wasn't a "standard" registrar feature. I'm with 1&1 and have been dying to switch forever, but this will make me look twice at any alternatives.

I'm sure NFS isn't the only registrar that fits my description. They're just the one I know about.

I would love to hear about others that hold the same standard.