As Shannon Drake asks in the latest Escapist, "If we can make world-class boob jiggle physics, someone out there can write a compelling, interesting good guy who's as interesting as the bad guys we know and love." Good guys exist for us to project ourselves on to, but bland, cardboard cut-out heroes are still unappealing. In MMOs this is still the case--we can shape our characters in almost any way we choose, but fundamentally we'll still end up bashing at the same monsters as everyone else, with little care for why we're doing so in the first place.
Some games have attempted to put more depth into the player-to-protagonist experience--Fable, Jade Empire and Black and White all encouraged you, the player, to shape your character and the world. However, that's only a step in the right direction. Believable enemies and sidekicks may require intense AI, but writing a good story with complex characters isn't impossible.