While it is clear how it does the trick, it is really misleading about what the pragma does.
I have some of that feeling as well. But please note that this pragma is only intended to be called from the commandline (it actually emits a warning when you're trying to use it inside a script). So my thinking was, use "begin" as a pragma to activate certain =begin pod sections.

I would rather have a debug pragma
I've thought about using =debug as a pod delimiter. The thing is that many pod processor generate a lot of noise when they encounter an unknown =pod delimiter. Wherease if they don't know how to handle =begin, they're supposed to ignore it.

...a quick search and replace in your module shows that it can be done...
Indeed. That shouldn't be the problem. But causing headaches for maintainers of pod parsers may be a problem.

...as a pragma with two parameters, one for the tag and one for the label to activate.
I think that would make it more confusing and obfuscating. I think the namespace idea that I head, may be more handy.

... the code after the POD block disappears.
That's because:

print "before\n";

=pod
Whatever I want to include here.
Comments or code, it doesn't matter.

=begin DEBUGGING

print "inside\n";

=cut

print "after\n";
[download]

becomes after conversion:

print "before\n";

=pod
Whatever I want to include here.
Comments or code, it doesn't matter.

{

print "inside\n";

}

print "after\n";
[download]

which makes clear why the code disappears. I could check for that at the expense at a more complex filter. Or add another CAVEAT. Probably the first.

Thanks for the feedback.

Liz