Sounds similar to a game I've been replaying lately - Geneforge. I love it. One of the games actually has four different factions you can join and pretty much anthing you say to anyone will change things in the game. (So far there are five in teh series ,and I have the first three)
SOMEONE ELSE KNOWS OF SPIDERWEB SOFTWARE GAMES YAY!*
The Geneforge games and the Avernum games is pretty much the epicest thing out there. More people should look at that design philosophy; solid gameplay, immense worlds with content everywhere, and interesting choices. The servile factions and later the other factions in the Geneforge games gives pretty big moral choices - does someone that's created entirely by magic energy deserve any degree of freedom?
*This is not a way too late reply at all.