Aye, too much of the dialog stops making sense and the NPCs don't react to the "alien creature". Of course, I never really liked it that the game let me, as a khajiit character, enter cities right after the caravans tell you "they don't let khajiit in"
I'd rather see some sort of questy thing where you have to get an exception badge or something to be able to enter cities and even then the guards give you a hard time
