It would be interesting if NPCs could react believably to free form input from the player, but that seems unlikely to be reliable. I'm not sure how you'd map the text to in game actions.
Like, you could have the LLM respond with "ok I'll let you have my horse if you leave in the morning, and solve the zombie problem" but it's not trivial to make the game world respond to that. Not even counting it breaking out into "sorry as an LLM I can't ..."