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CAL4M1TY said:
Eye-Co for me.

My reasoning is that "Co" doesn't exist in the Japanese language ("ko"). If they wanted it to be pronounced "ee-ko" they would have spelt it iko. I know that L and R are often mis-interpretted in the language (remember Zola and Zora in OoT?), but C and K have basically the same pronunciation in English, so the translation from K (in japanese) to C (In english) is the same, so therefore they should have no problems naming it "iko".

That's my opinion though.

It's without a doubt that they wanted it to be pronounced "ee-ko" (just check the katakana spelling). As for why would they spell it Ico instead of Iko, I think it's to keep all the puns. If they spell it Iko, it would automatically mean "orphan". Now that it's "wrongly-spelled", you can take it to mean both "orphan" and Ikou, "let's go!"

Just like Okami, in japanese it means wolf, but the game is not spelled with the wolf kanji (狼) but with 大神, which means "big god".

Japanese love playing with names