The beginners Guide to NPC's
NPCs (standing for Non-Player Characters) is a generic term for all the other humans (of various Races) that you will encounter while playing the game. NPCs include both named NPCs and unnamed NPCs. There are some NPC's that are controlled by the admins and some that you yourself can control and create.
NPC's controlled by the admins
Currently there are four NPC's controlled by the admins. These are Uriel Septim VII, Imperial City Guard, Random Commoner and Random Creature. These are made to enhance the playing experience for everyone and will stay objective at all times although following their logical behaviour. For example, if someone steals at the market a guard may show up and try to arrest you, no matter who you are.
NPC's that you can control
You are allowed to play out conversations and interactions with any NPC found in the universe of the Elder Scrolls. You are however not allowed to kill any canon character. Other actions like trading, learning and so on is encouraged. If you have any doubts about the story line you want to play out contact one of the admins.
NPC's that you can create
You are allowed to create as many NPC's as you want as long as it doesn't go overboard and as long as it is logical. They are allowed to aid you in battle but by doing this you share your ability levels with them in order to not give you any advantage.