I can imagine it being used in non gameplay affecting ways first. For example, imagine a GTA like game, where a radio station comments on a crime you just did. “Reports of a person shooting down a helicopter at Main Street is escaping to downtown”.
Or enemy AI giving directions to each other. “He’s taking cover behind the sofa! Let’s flank him! Shoot! He’s escaping through the window! After him!”
Or just NPCs rambling random nonsense about their lives.
These situations are easiest to deal with, because if the AI does something wrong, it’s not the entire world. You’re not going to fail the quest or something. But if they do it well, it will significantly increase the player immersion. NPCs are no longer empty shells. They’re really reacting to the world with their own thoughts.