1. Palladium is broken enough to have multiple players making characters by the same rules fairly with each player interpreting the same rules different ways. When you're running a game that suffers from this flaw, you need to provide a consistent interpretation of the rules and an audit of sheets is necessary.
Even in the age of computerized character builders, I am shocked at how many 3e & 4e PC sheets are full of mistakes. Same with White Wolf and of course Hero. I won't ascribe "cheating" to most of them, but just honest mistakes and confusion about rules. That's why I audit PCs for most every campaign.
As soon as things get more complicated than OD&D or Traveller, having the GM as part of chargen can be important.
3. I've done a fair amount of larping and staff work on larps. If I see a system that works on a large scale and prevents arguments, I usually adapt it to my small scale games.
Always a good plan. I definitely find that running LARPS has benefited my GMing on the tabletop.
Pursuit of game balance is not a cult undertaking. Assigning the word cult to game balance places it in a derogatory category.
Cult is the exact word for RPG fetish for balance. RPGs have been poisoned with a belief that if we only had the perfect rules, then we'd achieve tabletop utopia where everyone would be equally wonderful snowflakes.
3e said "Control the DM", 4e said "The Math will save us", Hero said "Thicker books!", and now only Monte Cook's 5e can save us! 5e shall bring us the Nirvana of Balance...or maybe 6e! Surely Pathfinder 2e will be utter perfection!
Even more laughable is the cult's desire to make games where noobs and veterans are instantly on equal footing. Even Chutes & Ladders fails to meet the cult's demands. Outside of Candyland, even games for small children reward repeated play and game expertise.
But as much as the cult is praised over and over and each "even more balanced" RPG is worshiped, the end is always the same. The super-balanced game turns out to be easily breakable or decried as "flavorless".
Aside from extremely artificial setups, it really doesn't work.
I never had this issue.
I always have pre-campaign discussions with my players about my thoughts for the power level and get their thoughts as well. Then everyone chooses OCC/RCCs accordingly. If somebody wants to play a "lower power" PC that our agreed upon power level, that's their choice.
If your game is 99% combat, then of course the combat powerhouses are going to dominant. But if your game is 50% combat and 50% interaction, then its not a issue.
The Glitterboy, the Mind Melter, the Weird Uber-Alien and the Full-Conversion Borg can't walk into a Coalition City. Heck, outside of Tolkeen or Atlantis, most SDC squishy communities aren't going to be very welcoming to these mega-killers. The Vagabond and the Rogue Scholar however can fully and easily interact with fellow squishies.
I run heavy combat Rifts and Chaos Earth games (at least 50% of my games are about fighting) and "suboptimal PCs" would be perfectly fine choices because at the end of the day, its a human (-ish) world.
A GM can shine a spotlight on any character, but if the Vagabond player's perception of the situation is that his or her character isn't doing anything comparable to the other player's characters, that spotlight will seem like a repeat highlighter for how insignificant, or carried, the Vagabond really is.
Regardless of the game, the player should enjoy their character. If a player only appreciates when their character is an uber combat monster, then they need to pick combat monsters.
I've run plenty games of the Stormbringer RPG where your character can randomly be a diseased beggar or impoverished peasant and Warhammer 1e where you can wind up a lowly herbalist or artist's apprentice. Our game clubs always "let the dice fall" on the Gamma World mutation charts....and sometimes the results were sad and pathetic. However, FAR more often than not, the players have had a great time with these "failure" PCs.
For many players, there is great fun seeing if their lowly PC can make a difference. For some players, "lame" characters are a roleplaying challenge, like playing a level 1 Magic User or Monk in AD&D...or anybody in Call of Cthulhu.
Also, "success" for a Vagabond is different than "success" for a Cosmo Knight and some players value the "little successes" of their weaker PCs.
I am NOT saying that Palladium games are for everyone. No way, no how. But for many of us, the randomness and the funkiness and the imbalance are features and not bugs.
And one of us who thinks the Rifts setting is impressive is Jerry Bruckheimer, the producer of Pirates of the Caribbean, who has spend several hundred thousand dollars (perhaps $1M+) on ongoing development of the Rifts movie. Of course, Bruckheimer regularly spend millions for development of movies that may or may not ever be seen.