I also ran with it, albeit, I did rename the empire title. It was initially named after my characters dynasty, this case being the High King of Sarnor. Of course, when I declared war against the Dothraki, I've managed to diplomatically unite the Sarnori (and Omberi) Kings under one banner quite easily (only 1 county lost to the horde). I renamed it to "The Sarne" and the adjective to Silvermen. Shame there's not a more lore friendly name to give. Perhaps you could come up with something more appropriate.
I ended up destroying it, but yours is a very interesting lore friendly argument to keep it, I may do the same the next time!
This would be a bug, we shall look into it!
That is good to know, thanks!
For anyone who wants to destroy the title and is not sure how, I will leave this here. It is kind of an annoying process, but not that difficult:
1-You have to discover the title's name. By opening the save file with a text editor it will be right by your character's description. In my case, it was "e_dyn_3".
2- Find an independent count (one of the pirates or one of the summer islanders would be a good choice) and grant him your titular tile using console commands. Now he will be your liege.
3- After that, console switch to him and diplomatically grant yourself independence (note that you both must be at peace for that).
4-Then switch back to your character, find an unlanded character and console grant him the
county title of the character you have granted your empire title to. What will happen is that, as he becomes unlanded, the titular empire title will be destroyed and will disappear from the game.
I'm not sure if there's an easier way to do that, but it worked for me and afterwards it was like nothing had ever happened. I remained the High King of Sarnor and the title disappeared completely from the game.