I'll put in an early bid for Witcher 3's generic NPCs, especially for the impact in Novigrad - literally fleshing out the city.
It must be one of the trickiest choices to make in creating a new game world. Do you do a Skyrim and have almost every NPC (beyond guards) be a named character with their own life, even where you have little interaction with them? But the price is that you have to limit the scale of the city and its population as a result. Every city's beggar - token in their uniqueness - just reminds you of an entire, missing, underclass.
Do you do a Far Cry where 2s or 3s of nameless NPCs, whose raison d'etre is to dive under your truck, pop the heck up out of nowhere? And gleefully they dive, because their AI tells them to run around like headless lobsters when a car appears?! (I'm playing Far Cry New Darwin Award currently)
Witcher 3 nails it. The choice to use generic NPCs lets CD Projekt Red build and populate a huge, huge
city - and make it feel alive. Think with disdain, if you must, of Novigrad and its flocks of NPCs called Strumpet, and the recycled faces. But then think of Novigrad without
them or their cohorts. It would just be empty, soulless stone - as PCG has previously noted I think
The NPCs are also a crucial background. They're the little people, the cattle who simply don't matter to the characters who shape the story - whether white-knight Geralt or someone like Orianna. Plus it's refreshing not everyone instinctively knows you can be the demi-god hero who can fix all their problems. It's not that Unnamed Strumpet #714f/c doesn't have problems (I expect), she just doesn't take you to be her personal Odd Job Protagonist.
The presence of generically-named NPCs that you can interact with (e.g. Blacksmith, Merchant) helps blur what could otherwise be a too-harsh contrast between named (Get Your Quest Here!) NPCs and the nameless sheep, too.
It's also contextual. Wolfenstein Youngblood's Paris felt conspicuous for the total absence of civilians, but it worked for gameplay. As for Geralt knowing who to talk to and who not to bother with, he has Witcher Senses and is very worldly-wise so if he just knows
who to talk to, fine.
More than a para, but only a few replies so far, and I'm bored, so apols