You quoted me, so i'm answering to your quote now...
I'm not referring to this problem as a big flaw, actually it didn't even bothered my gameplay of the game, i'm just making a statement about what the OP is referring to... and... as i said previously, the complain is not about the "yes" or "no" for recognition, it is the WAYS of recognition that really stands up as a immersion problem here, specially for the sneaky ones that get saluted at every corner.
EDIT: Indeed you must be infamously recognized if you get persecuted by guards in the middle of the city or reported by someone, and famously recognized if you get WITNESSED/described during/after doing a world changer deed... but you should be able to disguise yourself, it should be a possibility at your disposal (with some variables for sure).
Fair enough...I think it was the feces smeared mask that did it for me lol, but I had to say something. I still dont think that 'disguise' is as big a deal as some make it, but completely agree the system for noticing and remarking on a players status needs completely revamped.
One issue is that there are multiple different 'names' and statuses you can earn, such as for doing the main quest as opposed to doing the thieves guild quests. If I do both, am I the Hero of Kvatch, or the Grey Fox? Certain NPCs could refer to you as certain names similar to OB, where beggers/thieves guild members associated you with your theives guild ranking, while random npcs typically associated you with your Main quest status. Regardless, I dont get paid nearly enough to work out the details. Hopefully one day, when Im working for gamesas, I will have the honor...
Even more annoying was how people referred to your stats. Again, it was a great idea that was poorly implemented. Now, everytime I walk by someone I overhear "You look like your handy with a Blade" or "You have the eyes of a trained marksman", or other stupid , generic comments. They were awful examples of AI, and every time I heard it I cringed.
Again though ,its not that I dont want people to notice how uber good I am with the sword, I just dont want them to sound so stupid and artificial when doing so.