I think all NPCs (excluding retainers) should have full collision detection to prevent players from standing in or running straight though them. Player collision I don't support because it can be 1) abused 2) a pain when going through heavily congested areas and 3) would make full party (8 members) play much more frustrating if all 8 people are trying to hit one mob, even more so if said mob has a breath or tail swipe forcing players to all crowd in one direction.

Off topic I seem to recall that the OP made a thread about chocobos inside towns. Crowded town + chocobos + collision; what a nightmare that would be.