You just need a nostr.json file in the /.well-known/ folder with the names and pub keys of users. https://blowater.deno.dev/.well-known/nostr.json

Here's mine https://nostr.haus/.well-known/nostr.json

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This is manually created right? Whereas he can have 10,000 DM app users. He would have to keep track of them in DB... so that his service is aware of all users and returns given name=XYZ appropriately. He maybe doesn't think about registering them yet (i dunno what exactly he is striving for... but at least he has stuff to think about until next time)