We called it a Service Worker because the API follows the W3C standard Service Worker spec:
https://www.w3.org/TR/service-workers-1/
https://developer.mozilla.org/en-US/docs/Web/API/Service_Wor...
I agree that the naming is not completely intuitive, but these are the names that exist and so we're using them.
I'm not aware of any similar spec for DNS workers so I figure we'll use whatever name we want there.