I was somewhat irked by the way my character would become over-encumbered in Fallout 3. I would be able to run, run, and run some more as long as I was half a pound under the weight limit. I think that the process should be gradual, like slowing down when you have more equipment until you just can't move quickly. That would be more realistic, and it would make the wasteland much more interesting as you would want to select your supplies carefully. This would make the previous suggestion of backpacks more viable (And backpacks add to realism as well... Who can carry tons of supplies in your pockets only?), and make hardcoe more hardcoe (You can't carry tons of food and water and ammo). It's a suggestion that would make the game more strategic and more difficult.

Not really, I like the instant over encumbered thing.
It's still a video game, I don't really feel that this is necessary for the game.
Would probably just end up annoying me like crazy.

Hmmm... yeah I don't know. The gradual thing would become annoying after a while. I loot a lot, and sometimes in a pinch I need to drop one item so I can run out of danger.