Version:            (using KDE KDE 3.4.0)
Installed from:    RedHat RPMs
OS:                Linux

When I left click on a file and try to modify the 
owner / group of the corresponding file and enter
a nonexistant user / group, the system doesn't give 
me any errors and rather use "root". 

I think this is misleading. Better way to handle
this issue is to show a dialog to the user telling
that no such user / group exists and gives two 
suggestions, i.e

Do you want to modify the owner and group of this
file / directory?

a) Yes: Forces user to enter another user / group 

b) No: Resets to default (previous) entry