If you don't know what I mean, let me explain. A villain is not black and white nor is he some shade of gray simply for the sake of being so, a proper villain has a logic all his own that conflicts with societies logic as a whole, but leaves the audience/player/reader both empathizing with is plight, as well as understanding his motivations and actions. Take Hannibal Lector, Moriarty, or Erik Lehnsherr all classic examples of characters developed who would by all rights be considered villains, but each had reasons for their actions, they had a history, they have goals and dreams, and they think what they are doing is right while simultaneously understanding why others think them wrong, they are as capable of empathizing with their enemies as their enemies are with them, but their unique logic drives them forward. Its not difficult to alter ones mindset to why the end would justify the means, its not difficult to look at an aspect of society that is wrong and see it as irrelevant to follow its fallacies, its also not difficult for the imagination to advocate a vigilante no matter how cruel sick and twisted he is if his form of justice results in more good then bad ultimately. Yet for all these things a villain could be made, for all these things a Hero could be put in the position of making the tough decision of killing a villain whose only flaw was doing what he thought was right. The hero may even be forced to make the world a worst place in the process of killing a truly wicked individual in a trade off that is not worth it empirically, and is only rationalized ethically in the moment.
These decisions are the ones characters should have to make with villains, and more importantly, the mystic, and the mysterious character so prominent in so many RPG's must make a return. What happened to mystery? True genuine mystery, characters with vague pasts, and incomplete identities, whom you don't understand, whose intentions you don't yet know, and whose positions in the world you don't get are increasingly rare, and yet AN AMAZING asset to any story. Nothing is more intriguing then having a character in the game whose potential you don't know, particularly when you can't tell if they are using you or helping you. It adds mystique to the plot, since you don't really know if they are a good guy or a bad guy, or what side of the issues they stand on, it puts you in a position of wanting to push on and learn more, throwing in rich history's plot twists, connections and involvements of these characters with revelations related to your journey only intrenches you deeper in the story and makes you long to learn more. This is a feeling lost in almost all games that would be revolutionary if added, and its difficult to understand why it isn't already there.
Finally the last issue is that they must be true characters, living and breathing in the world, interacting and changing along with you. You have an influence on them, as they do on you, and you should have choices, these cannot be linear relationships, and as such they can't be linear quests, drive the plot forward with passion, desire, intrigue, and depth, make the character feel like he's part of a living a breathing story as much as a world, but don't limit his actions, make us decide the path, that's why the gaming market has so much more potential then cinema and literature, its the choices. I want TES V to be a totally new calibre of game, I want it to make the finest works of literary masterpiece, and motion picture entertainment seem flat compared to its depth... If this is the game that pulls that off, it will be the best game ever. If not, I'll still love it and play it, and oh well, but someday another development team will master what Bethesda couldn't....