While that is pretty adorable behavior I think you are getting a bit carried away there. You are assuming that just because you understand that things have names the dog does too - ie that because it has made a distinction then it understands identities. 'This is not a pipe'. Etc
What's more likely is that the dogs thought process goes something like "when my owner makes a noise that sounds something like "bed" I should lie down. There are some spots sure I can lie down where he does not repeat the command. This towel is nice."
Then again maybe you have a super dog.
While my computer rarely crashes during an encode I feel your pain. Video encoding is no fun, especially without a quad core.