I think it's difficult for a human to run a true simulationist game. We're not built for tracking all those variables.
While it would be good DM practice to build tons of NPCs and have their motivations and plans mapped out and such, mapping and revising their actions while running the game for the PCs is a bit challenging. It may not even be worth the effort, considering how much material may go unused, just because the players went east and not west. And that breaks one of the DungeonCraft adages, "don't create more than you need"
Case in point, early in my DM's career, he had one piece of an adventure, where he drew up a forest and rolled up encounters all over the forest. He had them all written down, and knew where each one would take place. During the game, we simply walked from point A to point B through the forest. We hit several of the encounters of course, but the majority of them were missed entirely. Now the premise was valid, we could go anywhere we wanted to in the forest, and get all sorts of interesting encounters. But the reality was, we weren't very likely to deviate from a predictable path. As such, it was not worth the time to write up those extra encounters. In fact, he could have spent that time improving the quality of the likely encounters or reduced the time spent writing the adventure.
Further evidence at human inefficiency in running this style lies in the example of a dungeon. Here we have a place filled with NPCs (monsters), and the PCs go busting into room after room. How many DMs are guilty of NOT having the monsters react to the noise of the invasion. Most DMs leave the monsters where they were written and have them activate only in the PCs presence. We all know this is not realistic behavior, but it is hard for a DM to track all the reactions that would be likely and respond accordingly. The main reason it is so difficult is that there are cascade reactions. There's just too much to really track.
To the PCs, all adventures are linear. They play out as "I woke up, ate some gruel, killed an orc, rescued the princess, collected the reward, avoided the town guard when it was revealed that the princess was a doppleganger, collected some info on who swapped her, hunted down the real princess, killed the princess because she was scheming a take over, and fled the kingdom." They can't see if you're running multiple threads contingent on their actions or if you've got one plot line with twists in it, and it doesn't matter if they can't tell the difference.
Janx