I run a p2pool node (http://blisterpool.com) and someone just connected with an invalid bitcoin address. They have significant hashpower, and have already started generating p2pool shares...but their address is invalid, so what will p2pool do when it comes time to pay out the block?
If it's actually an invalid address (that is to say it won't hash) such as
Address50 then vanilla p2pool will default to sending you (the node) all of the rewards for that miner.
If the address is valid (will hash) but no one holds the corresponding private keys for said address, like
1BitcoinEaterAddressDontSendf59kuE, then the rewards will sit in limbo for all eternity.