I think the day/night cycle itself wouldn't be too much work. I got it working fairly well for my mod, though there are some issues. Nothing that couldn't be solved with some minor changes to the engine, I wouldn't think though.
NPC schedules are another issue, but I don't think having a limited number of schedules would be too overwhelming. You don't have to attach everything to a timer. Not every NPC has to go to do bed, have completely scripted behavior. If merchants stopped selling and there were a few night/day only quests and skills, I think that'd be immersive enough, though Swen doesn't like half-assing it. It seems like they want to do everything, or not bother. If they actually let modders edit the main campaign (not mostly locked like D:OS), I might consider trying to add in a day night cycle with a few NPC schedules.
