Any specific verbiage that needs to be used?
Just tell them you will be flying an RC aircraft with 5 miles of their airport. You should have on hand the location you have in mind. Preferably, know the distance and bearing from the airport, like "3 miles to the southwest". Even better would be a more exact bearing and distance from the airport or a nearby VOR. Also know what max altitude you expect to be at. See the related question for a more thorough description (about NOTAM info, but the same general idea applies): How do I submit a NOTAM?
And if you are wondering how to get in touch with the tower: How can I find telephone numbers for FAA ATC facilities?
Can the request be denied?
In general I would say yes. One of the main rules of RC flying is to not endanger manned aircraft. If ATC thinks your selected location will break that rule, then you shouldn't fly there. That would be part of why they ask you to contact ATC in the first place.
However, the wording is "provides the airport operator and the airport air traffic control tower...with prior notice". It says nothing about receiving approval, clearance, or permission from them. So I'm not sure if you are breaking any regulations if they say no and you fly anyway, assuming you don't break any of the other rules.
Does anybody have any actual experience doing this?
Not me at the moment. I will try to update if that changes.