definately.... the dialog doesn't have to be interactive and rpg like... but something along the lines of the unimportant NPCs in deus ex would add immensely to the immerson factor, and the feeling that you are in a real world not just a game.
NPCs could have a couple of one line comments, sometimes varying depending on earlier actions that you have taken. They could also sometimes give useful tips or information... however if you have gone around scaring them they wouldn't give you anything.
Avoiding NPCs that might run for help but you shouldn't kill would also give some new uses to things like the stun batton and powers like mind trick.
I'm assuming that you will return to the academy every few levels and it will be a non combatant level filled with npcs where you can select new missions, equipment and powers. cool