Stealth stands out to me as a really janky mess in a game that can be very polished and quite high quality in other ways.
Thanks! I think this is a really nice summary. As combat and exploration systems aren't separate entities in BG3, the way they are in jRPGs or even PoE2, I think Larian needs to carefully examine the transition between the two modes, and their interactions. Why stealthed characters aren't included in the initiative roll is beyond my comprehension.
Something I noticed on a run couple patches ago is lack of neutral actors in combat encounters - there are some scripted ones like kid during harpy fight or cowering gnomes in the forge - for for "dynamic" NPC it seems like being caught in turn based bubble is equal to being aware of the entire battlefield. Perhaps that's why Larian keeps their bubble distractingly small, and limits active participants to the minimum.
I wonder if recent swarm AI could be repurposed for a "neutral turn" that could allow NPC beyond players immediate vision range to enter turn based bubble without slowing down turns. That way if they join the encounter or the encounter spills closer to them, it would make it less jarring as they would be in the same mode as the player. For example, having goblins patrol in real time, as you go through turn based encounter just feels very wrong to me.