In the story, you play inquisitors hunting down and eliminating users of banned magic, not pioneers.
+1 . Larian stuff.
Day/night cycle should dn't be cosmetic. There should be a way to tell the difference from a Scripting point of view. Some creatures go out at night only, and stuff like that...
But I really don't know what to do of all the mobs during night. They would have to go to bed at some point.
Maybe then, for simplicity's sake, day/night would have no influence on citizen's behavior.