I heard the same story (I joined in 2004). The version I heard was that Jeff was driving cross-country NY -> Seattle and was on the phone with his lawyer about incorporation papers, and the lawyer misheard “Cadabra” as “Cadaver”. That's when Jeff knew he needed a better name.
That's an interesting story, but that article and others on the site have weird issues that can't be put down as non-native English. Extra words that make no sense (Steve Jobs founded us), and phrases added into the ends of sentences along with spacing/punctuation mistakes (But please, pretend you’re interested in everyone’s questions, ”Jobs said at the time, as carry* the website Windows Central.*) Odd issues to see on a news website. Also, all postings are double-dated, once within the text and once after.