If I may go slightly off topic: It seems like the terms Shakspearean English and Old English are being used interchangably here. Shakespearean English is in fact modern english, but with a few forms that are now considered antiquated. Chaucer is Middle English, and as a result can be very difficult to read, even with notations. Olde English, to must of us, would be completely incomprehensible.
Are we being asked to use Shakespearean English? If we are, I was not aware. No one does, not even the people who are, IMHO, the best RPers. I think it is enough not to use modern slang, modern terminology, or any refernce to something that does not exist outside of PS. Yes, what is important here is the RL connotation. A light sabre cannot exist in PS because of the image it will instantly bring to most people\'s minds. Distractions like that just make it harder to role-play, no matter how you justify it as fitting in with the setting.
My character will ocasionally use a Thee or a \'tis, if he is in the mood and if it seems more proper in the given situation, but AFAIK it is not required.
EDIT: Swear words would fit the setting as they are by no means modern terminology or modern slang, but they are dissalowed because of the desired family enviroment. Therefore, IMO substitute swearwords that are considered \"PG,\" such as Freak, Dang, Heck, Crap, etc, are perfectly acceptable despite being modern. A world without swearwords is completely implausible and we should treat these substitutes as the real thing.