Wait... there are duels in the plaza??
I don't know what you're talkin' bout, but I want in!
I don't reckon I like the idea of my stuff getting taken, especially because, well let's face it, killing someone in Hydlaa isn't much of a big deal. I mean they get transported to the Death Realm and are forced to spend another 5 minutes running through it, only to emerge more or less exactly where they were before.
I do like the idea of NPC guard patrols, though. It sort of brings to mind images from The Elder Scrolls: Oblivion (you know, that game I don't have) where there are guards on horseback constantly prowling the roads and helping you if you're being attacked.