For example: If I approach an NPC at
point x in the game, with items y and
quests z, how would I work out what
the NPC needs to say? Branching
dialogue and responding to player
input seems as trivial as having a
defined script, and user input causes
the script reader to jump to a
particular line in the script, which
has a corresponding set of response
lines (much like a choose your own
adventure)
However, tying in logic to work out if
the player has certain items, and
completed certain quests seems to
really ruin this script based model.
Not at all. You simply factor the conditionals into the data.
Let's say you have your list of dialogues, numbered 1 to 400 or whatever like the Choose Your Own Adventure book examples. I assume each dialogue may consist of the text spoken by the NPC, followed by a list of responses available to the player.
So the next step is to add the conditionals in there, by simply attaching conditions to each response. The easiest way is to do this with a scripting language, so you have a short and simple piece of code that returns True if this response is available to the player and False if it is not.
eg. (XML format, but could be anything)
<dialogue id='1'>
<text>
Couldst thou venture forth and kill me 10 rats, perchance?
</text>
<response condition="True" nextDialogue='2'>
Verily! Naught could be better than slaying thy verminous foes. Ten ratty
carcasses shall I bring unto thee.
</text>
<response condition="rats_left_in_world() < 10" nextDialogue='3'>
Nay, brother! Had thou but ten rats remaining, my sword would be thine,
but tis not to be.
</response>
</dialogue>
In your scripting language, you'd need a 'rats_left_in_world' function that you can call to retrieve the value in question.
What if you have no scripting language? Well, you could have the programmer code an individual condition for each situation in your dialogue - a bit tedious, not all that difficult if your dialogue is written up-front. Then just refer to a condition by name in the conversation script.
A more advanced scheme, still not requiring a scripting language, might use a tag for each condition, like so:
<response>
<condition type='min_level' value='50'/>
Sadly squire, my time is too valuable for the likes of thee. Get thyself a
farm hand or stable boy to do thy bidding!
</response>
You can add as many conditions in there as you need, as long as they can be easily specified with one or two values. If all conditions are met, the response is available.