It might seem odd, but besides life-paths my other favorite way of letting people generate characters is completely free-form: just describe your characters in terms of the game mechanics. For this to work, you need reasonably mature players (or at least players who would be ashamed to be revealed in front of the other players to be complete power-gaming munchkins) and you need a system where it’s relatively clear what the different stats and abilities amount to, relative to the game world. If the players can’t tell whether STR 18 on a scale of 3-18 is literally something that 1 in 216 people have (so they might not even be the strongest person in a good-sized village with a 17) or if it would make them the strongest person they’ve ever met, or perhaps the strongest person that anybody they’ve ever met has encountered, then it’s really hard for them to be fair–even where fairness is just defined as being true to the character concept. Often, though, the GM can elaborate a bit on how he interprets the system to help fill in that information. (Will he literally roll 3d6 to determine the STR of a random NPC or does he assume that PCs are more variable than the population and they’ll travel far and wide before they ever encounter another person with a score that high.) With my homebrew I explicitly rated attributes and skills as to how common they were, e.g. a hobbyist level of skill, a dedicated hobbyist, a professional who used the skill regularly, a professional who used the skill daily, top ten in the world, etc. but there’s no reason you can’t assign descriptions like that after the fact to practically any other system as long as you’re willing as GM to put some effort into making it true. No fair telling your players that Rank 5 is equivalent to a working professional if every professional they ever meet just happens to have Rank 8 and beats the pants off them in any contest.
But what about balance? Well, here’s the dirty little secret of RPG systems: point-balance is by-and-large a crock. Even when determining pure combat-effectiveness, which is something that can actually be play-tested, most systems don’t go through enough play-testing–particularly blind play-testing–to actually balance the options and the myriad ways they can be combined against each other. And when it comes right down to it, combat balance may be the least important aspect of balance in any RPG. D&D didn’t even attempt it for decades (and despite 4e’s attempts might not have it today)–it was simply true that for almost all battles until very late in the character’s progression Fighters were better in combat than MUs. And Thieves never caught up. They weren’t supposed to. Early on, D&D didn’t even try to give everybody something useful to do in combat; Mentzer’s Basic D&D straight-out advised low-level Thieves to avoid it.
D&D wasn’t badly designed in that respect, IMO, it simply recognized correctly that to the players “spot-light time” is much more important than effectiveness at a single task. To the extent that being ineffective at combat is a problem, it’s a result of nothing more than spending too much time in combat compared to other things. At least in the beginning, combat was only one–and often not the most time-consuming–of a number of activities that were essential parts of exploring the dungeon: mapping, searching, dealing with traps, negotiating with the denizens of the Dungeon (yes, back in the day by-the-book play involved rolling to see each monster’s reaction, and it wasn’t always hostile). And once campaigns broke out of pure dungeoneering it became entirely possible to have a complete and satisfying game session where not a single to-hit role was made.
As an aside, one of the side-effects of 3e making combat a lot more involved, with a lot more rules for specific choices per round, was to make it take a lot longer and make having a character who basically hid during combat a lot less palatable. By reducing more of the out-of-combat stuff like attempting to disarm traps to straight die-rolls that take hardly any time to resolve, it tilted the balance further towards combat being the activity for the evening. So characters not having a roughly equal number of roughly equally effective combat options became a design flaw….hence 4e.
But, to get back to my main point, spot-light time is something that it’s almost impossible to balance through specific character abilities. It depends almost entirely on the scenario, and how the GM and the players approach handling it. If they actually act out important conversations, then negotiating with enemies or allies can provide a huge amount of time for the characters to be involved and do their thing; this could let socially ept characters totally dominate if the GM lets skills and character abilities dictate how things go…or it could provide fodder for everyone to strut their stuff (even if their stuff is to be rude and socially awkward providing interesting complications for the delicate negotiations). If they just roll vs. Persuade, then not so much. You can try and build systems where the main activity is going to be talking and negotiating, or investigation, but those are going to be the exceptions. Most of the time you just can’t predict when the characters are generated how much time is going to be spent with the spotlight on various kinds of character activities.
You could say that it’s the job of a good GM to try and spread the spotlight around evenly, and to play up the activities that the players enjoy doing and have built their characters around, and I’d agree with you. But there’s just no way a point-buy chargen system is going to help you accomplish that. Declaring that a +1 in fighting costs 1.5 times as much as a +1 in Persuasion, and 2 times as much as +1 in Crafting: Pottery doesn’t make it so for your particular group of players and campaign.
One of the things l like about Savage Worlds as point-buy chargen goes is that it takes a big step towards acknowledging this by subsuming almost everything that might fit into the character’s back-story but only come up in play rarely under Common Knowledge; they further recommend that anything that won’t come up on the average of at least once a play session not be broken out as a separate skill. They still like to pretend that, say, a +2 in Charisma “balances” against a -1 to be hit with ranged attacks, but actually as a quick-and-dirty way of saying “This is what’s notable about the character” it’s not half bad. At least we’re spared the GURPS insanity of making strictly more effective (same in all the skills, but with higher stats) characters cheaper to buy if you know the tricks of the system.
Compared to point-buy, and sometimes even random-roll, free-form character generation saves a lot of time. And I mean a lot, as in players whipping off new characters in the first five-ten minutes of a session instead of having to allocate half or all of a session to creating a new party. Moreover, the GM rarely has to do anything more involved than give the character sheet a once over to make sure there’s nothing particularly outrageous there and to make note of any secrets or special abilities he needs to keep in mind; no time is wasted double-checking math or making sure the character is “legal.” The character is legal if the GM and the players agree it is. It does help if they agree that the GM has some leeway to change his mind and ask to them tone something down if it proves to be more of a problem in the campaign than he first anticipated.
And here’s an interesting thing: in the four or five years now that this has been the primary way of generating characters in our main ongoing campaigns (for one-shots I usually just pass out pregens) power-gaming and munchkinism have been less of a problem than ever before. Not that my players were particularly prone to it, but there’s something about a point-buy system that seems to ask for players to push it. This is really striking with people playing Champions, and to a somewhat lesser extent GURPS, but it seems like such a system carries with it an implicit guarantee that because all these things have points assigned to them and there are all these (sometimes elaborate) rules on how you can spend them, in what order, how to get more points, and so forth whatever you do will be a reasonable “balanced” character and you are sacrificing effectiveness for no good reason if you don’t strive to optimize.
On the other hand, if you tell players “make a reasonable character, don’t worry about the points”, then that’s what they do. They don’t give the character eidetic memory if they don’t see him as having eidetic memory, even if that would save a boatload of points on the knowledge skills. At least with my players, I’m far more likely to look at the resulting character and tell them they can beef it up if they feel like than have to ask them to cut back so they’re a little less “best in the world at what I do–and what I do is everything.” The only minor issues I’ve had have been with players new to the group who’ve just come from gaming groups where it was a badge of honor to go for everything the GM will let you get away with, and they really have been minor, not requiring anything more than my saying “Most of the other PCs aren’t anywhere near that good. Maybe one skill at Expert, and another couple at Professional.”