With nicknames does it have to be two letters or can you extend it with an extra letter or so as it may get more confusing or does it make it easier?

Answer 1

It depends how your are changing the table names with your own nicknames.... there is no confusion at all

Answer 2

A nickname is kind of mnemonic helper. Whether it is one character or a longer string the nicknames shall make sense. Normally, I use 2 to 5 characters for table aliases, an example:
select ordr.ID as ORDR_ID, itm.NAME as ORDR_ITEM, ...
from ORDERS_T ordr
join ORDER_ITEMS_T itm on ordr.ID = itm.ORDER_ID
;