The feature was real time conversations, basivally in Oblivion everything inthe background froze when you started dialogue. Now people keep on walking through the town in the background.
I don't believe walking around was a promised feature
http://planetelderscrolls.ign.com/articles/news/7980/gamrReview-previews-Skyrim
"And dialogue trees are new, too; you can move around while talking, and the conversation options float in the air instead of locking you into a conversation." I also read about NPC's that keep walking around while talking to you, so far i've only had NPC's just standing around looking at me in conversations.
Press Shift during conversation.
Allows you to run about while talking.
I'm on Xbox 360 here, but i guess it should be possible on here too then, you serious or were you just kidding?