Well, there are some penalties but nothing really serious...
Like with Scanthril, I killed him before I even knew that he was necessary to become an assassin so I played without one.
Herespia wouldn't give me the Orb even though I had given her the serpent wand.
And with the Toads there was this one %$#@ing toad that would not get out of the way. I could not go around him even with a pixie. I could not push him out of the way and when I said goodbye he just stayed there. So I killed him. You can still finish the Toadem quest and the Warrior guild doesn't care that you killed them all. Even Mekdawa is clueless (in more ways than one, really).
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