But if the npc's would talk to each other and talk about events, use turn of phrases and even react to the player inquiring about these things, now that would be something.That's an interesting point, and with the accelerated questing and leveling and fast travel and all the leaving zones behind stuff that's becoming the norm ... no wonder players don't bother reading quest texts at all anymore. They just don't get the chance to care for the characters they meet.
They do this to some degree. It's really not too bad. Problem is that there is no character building in the story line. So you don't feel that any of this is important.
-- Nils' MMO Blog
I'd prefer a slower paced design, where players stayed for longer in the same place, and experienced more story with the same characters.
Looking back at a few quests in WoW and I see a common pattern: even when there's a bit of story developed between a couple of NPCs, they are nonetheless isolated from other NPCs and other quests. You play through their tiny set piece of story, and then move on to new quests from new NPCs, never to return.
Such a shame, because there's so much more potential there once you let Metcalfe's Law kick in, and you'll get to see more sides of the same characters. Maybe the lovestruck frontier warrior also has a shadowy gambling habit with a traveling goblin trader, is estranged from his father, and is also being groomed for promotion by the local captain. The captain who sends you on the inevitable series of kill-ten-then-repeat quests, also enjoys taking off with that goblin trader to do a bit of quiet fishing, and thinks he's left behind some unfinished business at his previous posting. And that gambling, fishing, traveling goblin trader ... well, best not to ask why he's got such itchy feet.
Then again, maybe I've been watching too many daytime soaps.