Oh hey I remembered that this thread existed.
Okay, so. Game with some sort of morality meter. However, the main character is, rather indefatigably, good, so Bioware Morality and a linear meter that determines whether you're good or evil doesn't really come into play; rather, it's more of a grid that determines what kind of "good guy" you are. Factors influencing this include but are not limited to: Collateral damage as a function of time, the amount of people you directly save through some mechanic or another (medical attention, maybe?), the means by which you stop the nameless opposition (finesse versus brute force versus talking someone down versus "you just shot a guy in light armor with a rocket launcher"), how much emphasis you put on getting paid and generally how much of a dick you are. Various abilities and/or gameplay features will then be locked or unlocked depending on what category you fall under, and people will react accordingly (e.g. being known for causing lots of collateral damage with heavy weapons results in smaller paychecks to cover damage to the environs, but enemies will be less likely to mess with you because they like staying in one piece, being a high-finesse person who saves a lot of people results in partisan assistance from nearby buildings, being greedy and violent results in you being able to purchase black market weapons). Mass Effect might have done something like this but I didn't play it and didn't read much about it so to hell with it.
"But what if you intentionally shoot good guys?"
The only reason you would intentionally shoot civilians and/or your own soldiers (if you do have "your own soldiers" to worry about) is, out of game, because you can and because you want to see what would happen. In-game there's no reason to, so in essence, the main character does it because he's suffering from a fit of insanity. Continue to shoot people and the game will start treating the character as if he really is going insane, with the audio and visuals changing to fit. So the angle of the screen might be slightly off somehow and the colors seem a little washed out and even though you're suddenly surrounded by enemy soldiers all shouting and firing at you none of the shots seem to hit and there's this screaming like a bunch of people are scared but it sounds so far away...
Something like that, anyway.