From what I've heard radiant story handles new immigrants into the province of Skyrim from other lands like merchants, mercenaries, bandits, refugees, etc. So technically theirs unlimited Npcs so if a quest giver dies and ultimately his family dies maybe the"ll just make it so that his uncle or something from Cyrodill comes to take up shop.
I'd like to believe you, but since when do we know there'll be these immigration flows to Skyrim? Could be I missed it, but it just sounds so terribly odd to me.
Yep, and that was mentioned along with the whole "relatives will replace them" thing- that you might have to work on the replacement's disposition, since they'll remember why they're working the shop instead of the person you killed. Which makes me wonder how far they can push the feature, since I'd think a quest (retrieve family artifact, whatever) would have to be pretty important for them to even consider hiring you after you kill one of their relatives. Sure it could work for some things- but they casual "Hey, could you run this across the street to so-and-so's shop for me?" stuff...not seeing it.
I've been skeptical about that ever since I've heard it. Only the possibility that a relative might give that quest to you just seems to make any credibility of the game world shatter into a gazillion bits.