Bahogar [2019-03-23 13:16:56 +0000 UTC]
The concept seems extremely interesting, and I would be delighted to play a game that implements it. Here are a few issues I could spot, or ideas.
First, having such an AI in the first place seems way overkill for the game studio. AI in game is far, far away from sentience or from creatively generating levels, besides automatic level generation.
The keyword here is: creativity. That's what makes the AI's job interesting or a chore.
If, somehow, the designers decided to let an AI be the creative force behind the scene, then yes, such a game would be believable AND interesting for the player. It would require the AI to look at the outside world, interact with the players to see what works and what doesn't, etc.
But if no creativity is needed, then the tasks you'll give the AI won't be engaging.
Instead of running the entire game you could be a smaller AI, like a conversational AI, whose primary task is to interact with players. That would allow more progression margin towards (a) getting more influence on the players, and (b) getting more influence on the game itself, on the mechanics, level generation, etc.
In order to get more power, you need "better" players (journalists, youtubers, wealthier people, influential ones...), so you have to make the game popular. The happiness bar would then directly influence your standard of living; it can e.g. influence your income, or the "level" of newer players, etc.
Your point (3) seems really interesting here, perhaps you could apply it even more? Like at the beginning you don't even know what game you're in, or that you are in a game. But people talk to you, and every time, a few lines of dialogues show up, and you can pick one to answer. (Thus you have a limited control over what you can say)
Then, you discover everything by reading the lines of dialogues: the game world. The mechanics. The outside world.
Not only the players' lines: yours can be informative too, and contain more information that what you know at a given point!
And later, some dialogues unlock various options, like the game map, the research option, etc...
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