Anyone who knows me knows how much I love language. Not just English, but any and all language. People like to imagine language (especially their language) is static, unmoving, and dependable. So dependable you can put it down in a book called a dictionary and it WILL NEVER CHANGE. I love it that this is so WRONG.
Language doesn't stop or even slow down; it's constantly evolving. We're closing in on 7000 spoken languages in the world today, and that's just the documented ones. What I really love, though, are the microcosms of language. Dialects are fun, but we really get into the nitty gritty when we reach slang; new words with old meaning and old words with new meaning. Words that make it to slang dictionaries are certainly the ones that had the best publicity (like movies, songs, or books), but there are so many more words created every day that don't make it past their birthplace.
My favorite language-creation situations are: 1) Family speak; which also applies to tight-knit groups of teens, ska (Sometimes Known As) gangs (NOT ska gangs, which could be cool) 2) Cross-cultural language creation; arises from being immersed in another language and struggling your way to understanding and 3) Mis-hearing what was said and either intentionally or unintentionally creating something intelligible though not necessarily understandable; aka acrylogia, Dogberryism (from Much Ado About Nothing), and malapropism (who could forget Mrs. Malaprop from The Rivals?)
I have to admit, in order to maintain a sense of humor with my kids, I intentionally create new word formations and phrases from what they said unintelligibly and say it back to them. The seven year old yells, "He's pulling my hair!" and it becomes, "What? Peas & pudding on the stairs?" It stops me from over-reacting and keeps them laughing.
The author/musician Frank Portman has done something wonderful with his character Andromeda Klein (from the eponymous novel) who mishears what people say all the time. What she first hears is often a stroke of brilliance compared to what she eventually deciphers into the mundane (packing up Sylvester Mouse was really picking up some extra hours). A great device that renders the situation comical and the character endearing.
Language creation (words, expressions, metaphors, analogies, etc) is one of the thrills of writing. Heck, it's one of the thrills of living as far as I can tell. Let's keep our ears open and find some more fun. Oh, by the way, there's a great website dedicated to misheard lyrics and a few other permutations @ http://www.amiright.com/.