I would change 2 things in the actual co-op dialog system:

1. if one is talking with an NPC, the other could click on the NPC as well to enter in the dialog as passive or maybe 3rd active participant.

2. if not entering the dialog it would be better to see the texts on the NPC till the talking player clicks and goes on. Now the text wanishes too fast.

I've seen that the NPC exits the dialog if the other character is stealing, that's really good!

We are proud to report that we finished our DOS2 localization project (Hungarian). :'-)
https://warg8.jimdofree.com/