The challenge is that a game has different requirements to a story.
The best games are the ones where the player can make differences through choices. Become the king or become the power behind the throne? Or become the Noble Knight and rise above base ambitions? Or become Sir Mordred and try to burn down the whole kingdom?
A story has a line. If you make the player follow that story line it tends to cause some frustration. It becomes a video that the player has to keep pushing the "play" button to get through. Many people find that kind of tedious.
One alternative is to have several possible choices built in. Follow this path or that path or the third path. In your example, you could have various possible paths regarding the smuggling. Go along with it or refuse? Or accept but try to turn in the smuggler to the authorities? You are already thinking about one choice. Maybe have several alternatives, possibly with very different outcomes for the player.
The result, if it is done well, can be that you actually have several games in one. You can play as the "good guy" or the "bad guy." And re-play becomes attractive. It means, effectively, you write multiple games in one package.
If it's done not-so-well it can be tedious. You have to do the "grind" parts of the game twice instead of just coming to the place you make the choice.
It is not a trivial thing. If you put all the grind parts before the decision point, then it isn't really two games, just two endings. If you put the grind too late it means to get through the game with each choice you have to re-do all the grind parts, which can be tedious.
One potential tactic is to make the grind parts completely different for the two paths. That is, it really is two different games. Different quests, different character development, different goals and tests, etc. This nearly doubles your workload, which is a real drag. But in several games it is quite popular.