Definitely remember witnessing this for the first time in North Freeport, specifically because the passing guard announced their discovery of the valuable and the small "bag" item on the ground disappeared, much to the chagrin of a rl friend; at the latest, this was months before Velious as I quit before its release. The NPC behavior is also mentioned in the trilogy manual, page 4/5, Arriving in Norrath.
https://web.archive.org/web/20040730...logyManual.pdf
Quote:
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Be aware that some merchants and NPCs are greedy and might pick up items they see lying on the ground.
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