Via the excellent Grand Text Auto (an amalgamation of narrative-focused blogs, founded by the guys behind Facade, well worth a read) I came accross Peter Mawhorter's The Incoherence of Reincarnation. In it, he argues against the theory that mechanics incongruous with the game world or story are necessarily a bad thing.
Modern thinking would tend to suggest, as I have, that any mechanic which breaks the story or world (eg player death or dialogue repetition) is incongruous and should ideally be better integrated into the story. Mawhorter suggests the inverse - that provided a mechanic is clearly signposted as being 'extra-diegetic' (ie outside of the story) it can be forgiven by the player. The parallel here is with something like chapter headings in a book, or time compression in a film. When we read the words 'Chapter One', or when we see a five minute business meeting in a film that represents an entire afternoon, we understand implicitly that this is not intended to be taken literally as part of the story. It's a necessary concession to the medium's limitations.
"The [incongruous mechanic] in a game setting is completely unimportant to the story, and in fact can effectively be considered extra-diegetic. Critically, when the player tells a story of the in-game events (say, to a friend), the [incongruous mechanic] usually doesn’t feature in it."On this interpretation, it could even be argued that attempting to justify these extra-diegetic mechanics within the game fiction is potentially disruptive. Bioshock's vita chambers bring to the fore a shaky element in the fiction that - in the form of a Game Over screen - would safely have resided in the background. Psychologically, removing repeated dialogue in RPGs wouldn't be affecting character behaviour, it would be affecting character behaviour presentation... and it'd be affecting it negatively.
It's definitely a perspective I can buy into. On one of my unannounced console games not too long ago we discussed how to handle NPC companion death, with the design team busting their guts to find ways to either keep the NPCs alive at all costs, or to somehow handle their deaths without excessively branching the narrative. The solution was simple.
Game Over: keep the fuckers alive next time.