It would be a huge workload for a large team too.
I desperately want to play a game where choices are meaningful, and I thought Mass Effect would be the first to do it (and how wrong I was). Making a game with that much horizontal content (as opposed to vertical content ala the linear critical path) is just economically unfeasible. Content that a player doesn't see because they chose a particular path is content that might as well not exist, but all the player would see is a game whose path is shorter than traditional linear games, and then complain about it, thus it could be argued as wasted money. That's why Telltale Games' games end up making your decisions amount to nothing, but it just can't be helped with the amount of graphical fidelity they're going for.
The only reasonable way it could work is if the asset generation was extremely cheap, and the only genre that can do this well are Visual Novels and Text Adventures. All you need is to plan out your story paths and write text, and if you want to be fancy draw up static backgrounds.
I heard about this game 80 Days on another podcast, it's a retelling of 80 Days around the World but in a text adventure format with some graphics. The game's story diverges massively depending on your choices and there is a massive amount of encounters, random events and subplots that happen. The kicker is this, the person who planned out the story and wrote the dialogue took 9 goddamn months, and that's just text.
