Jodie said:
Based on what little reading I've done so far on what is considered a species it seems that you first decide what factors you want to look at and pick the name that best applies.
I've actually gone through the process of naming species, so I can give you some greater insight. Doubt it'll do any good--what do I know, I've only published in this area--but I'll try.
Subgroups within each taxa, based on the morphospecies concept (which, incidently, is precisely the same concept as is used in the field by all biologists and uses precisely the same math as genetic cladistics) are identifiable by specific traits. For example, mammals are identifiable via their teeth, jaws, and skulls--those features evolve quite rapidly in mammals, and in living mammals we can determine the diversity of such features within a species. If it falls outside of that range, it's likely a new species. There's currently some controversy about Equid taxonomy based on differences of opinion as to the diversity within Equid species in terms of tooth morphology, which shows we're more than aware of the potential problems with this methodology. In ammonites, we don't have teeth; however, their sutur patterns are diagnostic for each species. Decapods are trickier, but the shape of the grooves, presence of spines, etc. on the carapace are used to identify things.
If you go higher up the taxonomic scale, you end up with different diagnostic traits. Mammals are identifiable by their rather unique bone structure--if you show me a fragment of a bone a half-inch long I can frequently tell you if it's mammalian or reptilian (skulls are tricky). Decapoda is obviously defined as arthropods with ten legs (except a group of hexapod crabs that have secondarilly lost their back legs). Ammonites have convoluted sutur structures, and a few other traits.
Go to higher taxonomic levels still, and different traits are diagnostic. Chordates have notochords and a particular muscle shape. Arthropoda is....problematic. I'm of the opinion that it's a polyphyletic group; taxonomically it is defined as segmented organisms with paired limbs and an exoskeleton. Mollusca has certain anatomical features that I can't think of off the top of my head (they're food for the stuff I study, which led to some interesting discussions with my old professor [an ammonite expert]).
The reason these were identified wasn't because someone said "We need some way to define this species I want to name!" In reality, what happened was that over the past 300+ years biologists have taken extremely rigorous and careful observations of as many different organisms as they could get their hands on. Basically as soon as they started they realized that the best way to organize biology was a nested hierarchy. This didn't have to be the case; such a hierarchy was tried with geology and failed miserably. We now know that it works because each diagnostic trait of a higher-order taxonomic group is merely a much older division between two species, which has been altered and added to and used to support other structures through evolutionary time until it has become indespensable to that group. It essentially CANNOT change; therefore ALL members of a group will have that trait. So lower taxonomic groups must be divided by other traits.
Unfortunately, to know which traits are important requires years of extremely diligent study. I don't pretend to be an expert mammologist, and I've been doing it for three years. Each taxa has its own unique traits that are diagnostic. To learn them you need to know what the diagnostic traits of higher-order taxa containing the taxa you're interested are. In practice, particularly in paleontology, you need to know the diagnostic traits of numerous other organisms as well. For example, a paleontologist that has mastered horse teeth but can't identify camel teeth is going to do pretty poorly in the Desert Southwest. And there's no short-cut. You need to get your hands dirty. You need to see the specimens.
Then, to name a new species, you have to compare what you've found against all known species of that taxa. That's why the higher-order traits are vital: they allow you to limit the field. We have >300 years' worth of this sort of studies; it can be difficult to wade through the literature. Taxonomists accumulate huge libraries of species descriptions, and compare the allegedly new species against ALL the species in the taxa they've proven it to be a member of. SO, for example, if you find something with a spine and a jaw with a protruding angular process, and which was only a few inches long, you can limit your search to "rodent". Still a big group, but smaller than "mammal". If you find a cheek tooth with a zig-zag shape, you can start looking into Arvicolinae, and hypothesize that it may be Microtus. The precise shape of the zig-zags tells you which species it is.
Now, you can call this subjective; freedom of speach means you're free to make a fool of yourself. That said, I've actually done this work and have worked with experts in multiple fields. I can attest to their diligence and rigor in these sorts of analyses. If you want to see what's required to name a new species, look at the monographs of the Burgess Shale Fauna sometime. They are dry as dust, written in almost another language due to the need to be far more precise than vernacular English allows, and often the ink used to describe the species weighs more than the species did. What you won't find is subjectivity. Disagree? Cool. Prove me wrong. Track down the monographs, read through them, and point out any subjectivity.
I do not consider this to be off-topic, by the way; it's a bit tangential, but it's certainly relevant. This entire thread is, essentially, about a person saying they have a new species. Well, this is a very, VERY short outline of the process I expect that person to go through. This is the model I will test their report against to determine validity. It's what every other scientist in the world has to do, and I do not feel it overly onerous to expect someone who wishes to revolutionize the fields of ecology, paleontology, and North American biology to abide by the same standards as a guy writing a fairly standard paper describing a new species of beetle. This is being extremely generous; given the claim being made, it would not be inappropriate to demand FAR more from this guy.