The main issue I am having now is being productive enough with these quest/story elements. It really is the meat of vex gameplay, and while it is steadily coming along it's really not coming along fast enough. I think that ultimately I need to be more disciplined, always moving on to the next item in the list without worrying too much about other gameplay design issues.
I've also decided to put the fighting engine back in. I think that the engine is usable as it is now, but will maybe require some fine tuning (I don't really remember, but I'll take a look.) I will definitely want to keep it simple, much more than the original direction was, and for basically the same reasons that I had originally decided to just take it out completely (I had figured that it was going to slow down/complicate gameplay too much, and I basically feel that way)
Now, fighting will be much, much simpler and depend basically on your fighting skill with each weapon, and what weapon you are using. I think, also, you will only ever face-off against one opponent, although the engine supports multiple opponents so I don't know.
The bottom line is, a simple fighting mechanic is convenient. When you are in a store, and a robber comes up, what better thing than to challenge him to a duel. Or if you are robbing somebodies house and are caught, will you fight or flight? Fighting I guess will give you items and money, but I don't think experience. I will save experience points for ship-to-ship or ship-to-alien combat.