Earlier quoted context omitted.
Good to address the security aspects of named pipe. However none of those describes how to secure the server. The server needs to call ImpersonateNamedPipeClient() on the incoming client connection to assume the client’s security token, that would lower the server’s privilege to the level of the client. That’s it! A guest level client can connect to the server. The server’s privilege becomes guest, and cannot access…
FWIW, the project in the article is explicitly intended to allow privilege elevation: "You have an application which runs in user context, without any administrative rights, and you need to perform some tasks which requires higher privileges."
The server can do whatever it needs to do in its higher privilege. Just when it interacts with the client connection, it lowers its privilege to the client's level. It gets the incoming data, sanitizes it, and reverts back to higher privilege to do the work. This minimizes the attack surface to the area dealing with client interaction, not the whole server. The server might link in a 3rd party XML library to sanitizes the incoming data and you don't know what the library can do. Running that in the client privilege level ensures that whatever it does only under the client's privilege.