NPCs: Less is more

One of my "DM rules" is to not show the NPC's power or level unless I absolutely have to. The PCs may hear of the reputation and deeds of NPCs, but not in a way that the players could reverse-engineer the NPC's level. I also tell my players straight away that whatever is written in the campaign setting doesn't have to be true in my campaign - especially NPC levels. I present NPCs by description only, and do not push mechanics and stats on the players if I can help it.

I do this mainly for two reasons.

First, I don't want players to feel sidelined by NPCs. I have suffered through games where the DMs ran big battles, rolling for their NPC heroes and for the enemies, and half the party literally was not allowed to even take part in the battle, but forced to watch it through a scrying mirror. I have played in a game where the DM rolled for 7 tricked out NPCs in a fight against dozens of orcs, commenting each strike and damage. PCs didn't really matter there at all. Not that the fight mattered anyway - it was just a vehicle to show off 7 NPCs.

As a roleplayer, my fun is non-existent if there is no plausible reason why my PC's action would matter and is basically busy work. If the DM is showing off his pet NPC, and in a manner that everyone of us knows that the NPC has access to this and that spells, and we have the important task to "take out the second leader to the left", and we know that the NPC could just wipe the enemy's left wing off the earth with a spell from the staff he carries, then what fun is there to be had? Immersion's nuked, and combat doesn't matter, so why bother?

Second, knowing an NPC's stats can lead to players trying to run the NPC, or armchair-quarterback it ("If it's a level 18 wizard, why doesn't he simply cast..." "With X Spell and Y item he could do this, and then that, and we do not need to do Z"). Needless to say, this can lead to trouble in a group.

Of course, there are ways to handle the sidelining/overshadowing problem. The NPC could be busy, buried in red tape, dealing with another problem, etc. However with the scope of the threats the PCs face, sooner or later the players will be asking why even such a crisis won't cause the NPC(s) to act, why they haven't some assistants who can take over the red tape for a day or three, etc..
Immersion takes another hit in such cases, and even if there is a perfectly fine reason for the NPC's inaction. It may hold the game up and cause strife if the players do not understand, or do not agree with the NPCs priorities - doubly so if they correctly suspect that those are just excuses to have the party do something the NPC could do faster and more easily. When this gets coupled with armchair-quarterbacking the results can be downright nasty - the DM arguing why a certain tactic or spell wouldn't work, to explain why the NPC won't try it, and the players stating why it should be tried, and poisoning the whole encounter from the start.

And even if that's not the case - the common "the archwizard has to deal with far worse problems!" reason - it doesn't help the campaign or the players' fun. Not many players like to hear "and while you were dealing with the goblin threat to Noonecaresabouttown, UberPaladin held back the hordes of hellgate and ArchWizardBob defeated the invasion from NecroCountry. Good job, folks, you did as well as the other three groups of heroes-in-training active in your area" after an adventure.

That's why I prefer not to show players that ruler X is a high-level whatever, or display the NPCs in ways that let players know their stats and powers. As a player, I am not interested at all in knowing how many hit points King Conan has, how much damage he does with power attack, how much damage he can shrug off and what his AC is. The DM can just tell me it's a warrior so impressive my characters knees might shake a bit, known and famous throughout the land. That way, I can assume that whatever threat we end up dealing with, political or social or combat, actually was a threat, and not something Conan could have dealt with if he had skipped his meeting with the baker's guild this evening.

It's even worse if the PCs end up fighting at Conan's side. I don't need to hear all the mechanical details, all the "and this is a really powerful NPC, I used this and that power, so you know he's really that more powerful than you, and could kill all the foes, but yes, we still need you, really, promise".

It's enough to just tell me he cleaves through enemies. Could be 4E minions, could be bosses, I don't know, and so my immersion is not ruined by the knowledge that the foes we fight do not present any danger because the NPC could handle the entire army by itself according to the rules because I can assume that the NPC is not that strong.

In short, I don't want my nose rubbed into the fact that all my character manages to do is saving a bit of time for the NPC so he can do something else, something much more important - like dealing with paperwork. I prefer the illusion of my PC's deeds mattering a bit more. Not knowing exact stats and especially levels allows me that.

So, in my campaign, Most of the visible power of an NPC is "Indirect power" - influence, followers, contacts, money, etc. - and not direct combat/magic power. Which means it can be logical that they'd rely on hired help for dangerous work.

Elminster has a big reputation, but he could be a level 5 wizard IMC with good ties to the bardic colleges. The Simbul is powerful - of course she is, she's the Queen of Alagond. And personally defeating dozens of Red Wizards? Of course she did, just as the PCs killing a dozen orcs is lauded as "stemming the tide of the great orc horde" by the town bard. Bards tend to exagerate the enemy's strength in their ballads anyway, so they cannot be relied upon. And players are not asking themselves why said NPC won't simply use spell X or item Y, or simply kill the invading army, instead of sending them on a dangerous mission because they are not sure if the NPC can do such things in the first place.

And as a side benefit it means I don't have to stat out that many powerful NPC seither, which saves preparation time.