GNU is the acronym for "Gnu is Not Unix". This means that GNU is designed to provide an OS comparable to Unix, without being exactly Unix. Therefore its name should appear in the OS name, imo.
Firefox or Xorg are not designed to be an operating system. They are just applications.
I think you've undermined your own argument there. All the GNU programs included in Linux are "just applications" too, and all of them can be replaced. (On embedded systems, they usually are, for instance.)