A three split bar system would help I think, where the idea is to eat and sleep to keep the bars at maximum potential. As you grow in level, it becomes less and less tedious like everything else, but does increase the sense of roleplaying for surviving. But naturally with a whole system supporting it, not just fatigue. Fatigue will never be more than your current max health potential (health - critical wounds - illness induced damages - sleep deprivation effects). Permanent damage to fatigue will be lowered gradually between each time you eat, so that your maximum fatigue pool is lowered. Drinking potions (power drinks) can boost it to your current max potential, but wears off when the effect wears off - you cannot fully replace food with red bull, the effect is temporary.
For NPCs, I think *their* current fatigue should be shown as well as their health. Visual feedback would be great but unlikely, other than sounding heavily out of breath. Can't remember ever falling to the ground due loss of fatigue in MW, but I could be wrong. So not a nuisance enough to be considered a big problem and unbalanced. Sounds like a fun concept though. Maybe if we loose conciseness most NPCs "play fair", and animals not looking at us as a food source ignore us (threat dealt with)?
The three bar split would even work for mana, where the "permanent damage" is increased a certain percentage of the mana cost of the spell, but at level 50 this effect is gone. So as in MW, you have to sleep to restore mana fully, and the automatic regeneration will work less and less. Percentage might be based on speciality, intelligence, willpower, and level, so that magic users get an advantage over a fighter that picks up on magic.
Rate of fatigue loss could also be affected by your current encumbrance. So it would pay off to thread light and carry your stuff in a cart instead.
A game feature should never make the game a pain in the rear, so realism should take a back seat to fun. While stamina would be reduced by running long distances for normal humans in real life, it just makes a game tedious.
I disagree. How much pain it causes should be a factor of your experience and what kind of character you are. That's how everything in games work. But yes, keeping it well balanced is the trick.