I was meant to make this thread a while ago and forgot, so apologies if somebody else has since.

My suggestion is simply. Make friendly fire an optional thing, not a forced choice.

The reason is that I can see already how frustrating that will be for solo players who want to get through the game with little to no people dying and/or haver not saved in a while, and will also cause untold amounts of arguments/fights between co-op players every time it happens.

It should be a forced choice on the hardest difficulty, but an optional one on all others. Oh, and I don't mean friendly fire simply between PC toons, but also NPCs as well. You only need to play Skyrim for a while to quickly see how infuriating it is when your attacks hit a commoner/guard (and you get a bounty for it, no less...) because they decided to play dumbass and get right in your way.