Everything we’ve come up with for distinguishing them brings up new gameplay questions/features.
I think you will be able to find some middle ground eventually where you don’t have to add new features and the artists don’t have to do too much heavy lifting.
I feel like simple things like bows or feathers can work.
I’ll admit, UI is not something I enjoy doing, so I’ve generally made it look good enough for conveying info, and then moved on.
The thing with UI is, it is really difficult to do while you are coding the game in. It needs to be done separately. (At least this is true for me and most other devs I have met)
UI takes a completely different part of our brains than coding. I recommend spending some time with the artists and JUST designing the UI and elements of it on a software like Figma or illustrator. This would make the dev experience 5x more pleasurable when you get down to coding it in, because you’ll have a firm vision.
This advice comes from my web dev experience where we have a strict rule of no dev before design. (That rule does not fully apply to games but the reason for the rule still exists. Taking UI decision while deving is notoriously difficult and often doesn’t give good results. )
Towns
I dont think we really require full free movement in the town.
If you CAN implement free movement that would be the best way of course but could also add scope creep.
This could be a potential flow that I can think of , that does not add too much dev time and pretty much no new art for artists ->
NPC in overworld > click on NPC > slimes tween towards NPC > dialogue opens up > finish dialogue click on next NPC> and so on,
Fixed paths , no pathfinding.
Just a suggestion. At the end you will be the best judge of what you want for the game.