Stolen items, depending on rarity, should always have a chance to be recognized when equipped on a companion. I want the possibility a friggin' Flaming Fist squad spawning yelling "I AM THE LAW!" as it proceeds to arrest or attack you or a "crime hunter" squad who investigate larger thefts and where possibly innocents are falsely accused/arrested. Anything but a quick and easy way to be more rich and more powerful as Larian usually opts for.
Ugh, maybe it's just me but I hate too much moral intrusion like that. Especially a game mechanic where loot is flagged in your inventory as either clean or stolen, and you can only sell stolen loot at a fence, not a normal merchant. The intent may be "immersion" but it ends up just being busy work for the player, especially with travel time to separate classes of merchants. I can't remember which RPG I played that had that mechanic, but I didn't enjoy it.
It is interesting to me you confuse roleplaying realism/immersion with "moral intrusion". Moral intrusion would be pervasive politically correct moralizing themes or old-skool "thou shalt not". Where do you begin to allow realism to interfere with your rather preferred playstyle anyway? Is being met with hostility after going murderhobo murderizing half the Sword Coast okay or also a "moral intrusion"?
As for which game, may I propose The Elder Scroll games which also come with such a system. Boy, those games are really unpopular aren't they? I'm sure you were miserable all 500 hours spent in game lol.
I primarily want balance restored in the risk/reward mechanism when it comes to stealing. I did not propose a simple binary system where all stolen items are treated equally did I? By all means, feel pretty safe about getting away with stealing those healing potions. Not so much walking around strutting Elminster's hat reported stolen just recently. Sell stolen goods freely to a goblin trader, risk the law selling to a merchant who might recognize it as stolen however.
