Whether a monster is an NPC really depends on how you write your AI. I''d imagine that most of today''s MMORPGs (AC, EQ, etc.) probably treat monsters as a seperate type of entity. Basically, the way they do it is that an NPC can be interacted with in a way other than just combat. A monster can only ever be faught with.
It would be pretty revolutionary, and I think one of the things that most people would associate with improved AI, if you could actually try to talk your way out of dangerous situations with creatures that might otherwise be concidered monsters. For instance, an NPC goblin could be intimidated by a few strong words from higher level Adventurer or trading could be initiated with an Orcish trader or (my personal favorite) you could pull a "Bilbo" and try to sweet talk your way out of sticky situation involving an ancient Red Dragon. ;-)
-Daedalus
DM's Rules:Rule #1: The DM is always right.Rule #2: If the DM is wrong, see rule #1.
My name is Christian Sueiras, here is my reply: What about creating a Multiplayer RPG, NPC-less game where the only computarized part is shopkeepers, etc. The computarized part does not need an AI, lets say when you go to buy the shopkeepers says something like "Welcome to my shop! Here are the items for sale", and a list of items display, so the user simply selects what he wants and the quantity, pays and leave. The problem, I agree, exists with the fact that users arent 100% of the time in the game just a 2-5% of the day, it is true that it might become monotonous if there are not enough players to interact. Then what the game needs is plenty of gamers from different parts of the world so that there are always players online because of the different timings. I am working on a RPG right now, and it does have NPC. But I have come out with the problem that some AI that has *random* actions gets into real trouble when multiple clients run the AI. I am trying to get the NPC-AI part into the server but it is quite hard to code. I am probably simply eliminate the randomness part of the AI. I am going to create an AI Script Parser that can work with code like this: PRINCESS AI:
goto BAKERY get 1, CAKE, OVEN goto CASTLE give 1, CAKE, PRINCESS goto BAKERY
Here the princess calls the baker and tells him to go to the bakery then she waits from him, the baker goes to the bakery gets 1 cake from the oven, returns to the castle and gives one cake to the princess, she receives it and then he leaves. Pretty straightfoward huh? The NPC engine should determine with each call what is the best path to get to the desired location.
I remember reading an article from the guys who made the game ''system shock 2'' about npc''s. They said if we cant make them so that they have awesome AI and great dialouge, why not just remove them. They admit that they may of gone a bit far with this, but they think they did the right thing.
I am glad that others look for alternatives to fighting 
