For example, the more realistic human character animations get, the deeper we seem to fall into the uncanny valley. The fact is that humans themselves naturally move in ways that look weird when put on a stage, so mocap tends to look sillier the better it is. Which is why we have theater, where movements are exaggerated.
Anyway, with AI characters, I expect it will actually be more frustrating and boring than not if they have realistic lives and schedules. All the littler irritations that we deal with and accept form real people just become friction in a game. Games, as movies and books and shows and plays and illustrations, don't need to be more realistic to be better. Media is caricatures of real life, with important information intentionally presented to give us a good experience. Taking inspiration from real life can give us better mechanics but blindly mimicking real life will give us shitty games.