So, I understand the hardship of unique dialogue for each and every NPC. Honestly, I don't mind the citizens or the guards. But I think unique dialogue should be shared amonsgt a greater range of NPCs.
To me this includes:
-Special NPCs, like for example Balgruff, Farengar, or in Oblivion Emperor of Cyrodil, etc.
-Merchants and other services NPCs, IDK about anyone else, but it gets annoying for merchants. People I have to talk to more often than even the special characters to say the same things
Riverwood trader
"What do you have for sale"
"Trinkets, odds and ends. That sort of thing"
Solitude trader
"What do you have for sale"
"Trinkets, odds and ends"
Each Merchant should be unique, in whatever they are selling. Maybe even some of them are more upfront, where as others are not. Some Merchants when you walk in, welcome you. Try to get you to buy an Item on Sale that you don't need.
Riverwood trader would probably have the dialogue
"Some people call this junk, me I call them treasures"
While a Falkearth Merchant would say something completely different
"What I can come by, in these harsh times"
-Quest NPCs
Well this goes into two things. Quest should be interesting. And the NPCs dealing out the Quest should be interesting too. All though he counts as a special NPC, a perfect example is Sheogorath because of his personality, and his oddballness. You don't care that he's putting you on a fetch quest, because he's absolutely balls insane and hilarious.
Or the Wood Elf in Oblivion who is supsicious of everybody and is paranoid about everybody. He's kind of weird, an odd. But you will do the quest because you're thinking, WTF is this guy on, Skooma, Moon Sugar, Spriggan Sap.
In Skyrim, especially Skyrim. They have Quest I am not invested in, Quest I get invested in with anticlimatic almost cliche and laughable ends, and they tend to be characters I am not invested in.
One of the perfect examples of the laziest quest I have ever seen, and what were the devs thinking on this one. Is Falkearth, deliver some ashes to the guy behind the inn.
Seriously. Pointless quest. Pointless NPC. He doesn't make me like him in anyway, or understand his grief.
It be much different if this is the original quest
"Can you do a favor for a disheartened man?"
Dovakhin "What?"
"Deliver these ashes, I do not have the heart for it"
Dovakhin, -.-
Now let's change that quest. You walk into the inn, and hear a man sobbing. At first you ignore him. You walk up to the inn keeper for a drink
Inn keeper says, "Poor old man."
Dovakin, "What's going on?"
Inn keeper, "He lost a family member. Truth I drown my sorrows out too, if I lost someone close to me. What will you have to drink?"
[suddenly that peaks your interest. or it would me]
So you move from the inn keeper to the crying man
Dovakin, "Are you all right?"
Man, "Oh lad [lass] it's a sad story to tell." [sobbing]
Dovakin, "I willing to listen"
Man, [insert how the boy died. Maybe make him a soldier an Imperial or Stormcloak who died in battle. Eh to mirror current events of our own soldiers fighting and dying. coming home to the family dead]
Dovakin, "I'm sorry for your lost" "He deserved it filthy [insert faction]"
Man, "I have his ashes with me. I know I should do something with them. But I don't want to put him in a crypt, it be like loosing him all over again. Look at me, I'm suppose to be a soldier. I'm broken."
And this is the important change
Dovakin, "Let me deliver the ashes" or You walk away from the crying man
Making the quest more optional. But you have some care and feeling in this world. It's more of an optional quest, that wouldn't be part of the "Help Falkearth People so you must deliver the ashes"
Anyway, that's just my two cents. Take it or leave it.