As a test I tried to pickpocket the bulls in the near the entrance to the first town, and they became hostile, and combat initiated. All the human NPCs around me became hostile as well - towards the bulls (in other words, the people allied with me, the instigator).

I guess it makes some sense (in their eyes the bulls are suddenly going crazy and attacking), but is that working as intended?

Also, the penalties for pickpocketing seem too severe. Every time I've failed while attempting it, a fight ensues (usually a massive battle involving a good deal of the town). Were these people burned by pickpocketers in the past or something? "Never forget, never forgive!"

My expectation is that the punishment would be more in-line with normal, blatant theft, where the summoned guards initiate a dialogue with you, and you can allow yourself to be arrested or choose to fight them.