I’m not entirely sure if this is 100% the right way to do it but I was desperately looking for a way to change the wording on the featured image box and also where it appears on the edit screen for a custom post type.

This was for a client with a looming deadline then I discovered this post on the wordpress forums. The JLeuze had managed to dig this all out while the wordpress community stays quiet.

add_action('do_meta_boxes', 'customposttype_image_box');
function customposttype_image_box() {
remove_meta_box( 'postimagediv', 'customposttype', 'side' );
add_meta_box('postimagediv', __('Custom Image'), 'post_thumbnail_meta_box', 'customposttype', 'normal', 'high');

It seems to work really well and has allowed me to change the fairly useless text of ‘featured image’ to something far more user friendly.