Is the Gameplay vs Narrative Story Over?

The Guardian has an editorial wondering aloud if the fisticuffs between narrative and gameplay is over. Why? Far Cry 2 is why.
But advances in videogame story telling may yet allow a truce. In Ubisoft's forthcoming shooter, Far Cry 2, you're sent to an unnamed African state to assassinate an amoral arms dealer - but when you arrive you discover that the economy has collapsed and armed gangs are battling in the streets. You must work with these groups to survive, all the while plotting your own moral route through the chaos. The player dictates the story, not the other way around.

"We call it dynamically assembled narrative," explains designer Patrick Redding. "Rather than having pre-set scripted events, we say 'here is some information that we want the player to have, here are a set of characters capable of delivering that information and here are a number of factors that the player may have influenced previously through gameplay, that can, in turn, influence the way that information is delivered and the kind of missions that are available'."
Dynamically assembled narrative? Oh wow, that sounds almost as advanced as what Fallout did 10 years ago! It took us 10 years just to get back to where we were 10 years ago! INNOVATION!

That said, at least they recognize BioShock kinda sucked here.
In other words, the story continually evolves alongside the player's actions, adapting to his or her decisions, rather than forcing them along a set path. This way, there's no fissure between you and the narrative universe. On his blog, the game's producer, Clint Hocking, last year criticised the best-selling adventure title Bioshock for what he called "ludonarrative dissonance": while the player's role in the gameplay is supposed to be about power and self-sufficiency, the story requires you to help another character. The two requirements contradict each other. Far Cry 2 is an attempt to avoid such formal errors.

Other developers are in a similar position. At GDC, Erik Wolpaw, the writer behind Valve's brilliant shooter/puzzler, Portal, complained that games often have a rift between ludic and narrative elements. He talked about horror games where players bump into innocent civilians, grill them for information, then run off - there's usually no facility for actually warning these characters about the zombies/ghosts/monsters who're following close behind. It makes no sense.

Most games fail to create immersive interactive narratives - they just chuck in a few plot-building scenes and hope for the best. Open-ended titles like Deus Ex and the Grand Theft Auto series point us in the right direction. Now it's time to explore the route further. The dream is that everyone who plays a game gets an entirely different experience. The huge computing power of the current consoles and high-end PCs, together with a new breed of open-minded developers, may turn this into a reality.