Radiant Story is a quest-making tool. Not a random NPC generator.
It would seem that to be the former, it would need to be able to do the latter as well, but I could be mistaken.
Sounds quite possible. It could also ensure that you always have a challenging Arena opponent by matching them to your level.
Isn't that what level scaling is supposed to do?
But in any case, I don't think it's been confirmed that the Arena is in the game, though we haven't been told it's not either, but if it is, I'd hope that Arena fights are as a whole ness repetitive. In Oblivion, it was pretty much just "Kill this guy, now kill that guy, now kill those two guys! Oh, now you have to fight the Grand Champion!" I mean, I know that was kind of the point of it, but still, in the end, it just got rather tedious, with each battle feeling pretty much the same, and the efforts to add a little variety really help much. I think it would be beneficial to have more variety in fights, such as having special rules for some battles, or facing more enemies that use special tactics, or maybe having some fights not be battles to the death, as already suggested, perhaps there could even be events outside of just fights for this sort of thing, like archemy competitions or plays (This could be sort of like that quest in Tribunal where you needed to choose lines based on the script, although you could also have actions involved as well.) after all, even in Skyrim, I find it hard to believe that a society where the ONLY form of entertainment available is watching people kill each other can be practical, although perhaps that is getting into seperate territory from an Arena faction like Oblivion's. I'm not sure how much Radiant Story could help with this, if any, but Radiant Story or not, if there's going to be an Arena in Skyrim, I want it to be done better than Oblivion's.