I had dinner tonight with a friend who's taught both grad students and undergrads at three universities over the past decade, and I was telling him about this conversation. He was very surprised to hear that in some places students address faculty members by their first names. They don't anywhere he's studied or taught.
Which as we pointed out is the flip in lots of places, I've never taught or been taught in any university (in the UK) where titles are used in face-to-face interaction.