Plays with the words in songs have their moments. I think we need to both know when to go for it, and when to refrain. One of my friends sings a lovely version of The Old Dun Cow, at a pub sing, and he usually points to someone to add the requisite "MacIntire". I like it that he often chooses someone new or shy, and it makes them feel included.
Another group of people I sing with, at a different pub, are much less likely to appreciate smart ass additions to the songs. (like the popping noise that goes with drawing the ring from his finger).

One that I confess really entertains me is in one of the local variants of "Drink old England Dry" (Drink