The players and GM can write a script together: this is improv-style cooperative storytelling. We can roll dice to determine the script: this is AbdulAlhazred's uniform mechanics. Or we can converse among friends with no script and actually engage in a social process: this is Campbell's first mode, in which the social role play is really just a group of friends sitting around negotiating stuff among themselves.
But how much storming out in anger actually happens at your table? Or falling in love? And are you saying that the GM is doing this for multiple characters at once?
Your points here are generally sensible but perhaps put too much a fine point on the distinction between inhabiting a character and free form cooperative storytelling. Both can be done in the third person, as it were. That is, I can say, "when my character hears that, she storms out of the room in anger." And I can say that either because it's what I think the character would do or because I think it would make a good story.