Recursive Transition Networks

Can you use Recursive Transition Networks as Smoke and Mirrors for apparent Intelligence in the context of Game AI, if so how, if not why?

Recursive Transition Networks(RTNs) are used for language parsing to create “well formed” sentences. RTNs can be used outside of games to generate essays and papers that have sensible sentences but don’t necessarily make sense when read together. In games it is used as a speech language parser to give NPCs a sense of intelligence when speaking to the player. Not only can they be used for speech but also the generation of appropriate rules and equipment.
As an example of speech parsing in games Bot Colony, the player can speak freely and the game will try to respond in a human intelligent manner. Compared to popular games being released now which use dialogue trees, voice commands, or other fixed ways of answering, Bot Colony is superior in technology using deeper processing than the other techniques above. 
How well do the Bots in Bot Colony actually talk?

By the technology you would expect that they could converse well however they may get confused as English is a complicated language to follow.
Despite that Bot Colony shows that RTNs can in fact be used in games.