The enemy AI is fine. Whoever said it's "atrocious," I don't know what you're looking for in an enemy AI. They shoot at you, take cover, and occasionally rush your position. It's no more or less sophisticated than the AI in your typical shooter.
The friendly AI is a little lacking. Sometimes, your squadmates are very helpful, using their special abilities to really jack up the enemy. Other times, they're utterly clueless. It's hit or miss, though in any event, it was never a show-stopper for me. Your companions don't die in combat, they just go down like in Gears of War, and recover as soon as you've killed all the bad guys in an area.
On an unrelated topic, yeah, Mass Effect is an action/RPG hybrid. It's an RPG with strong action elements. I compare this to Bioshock, which was a shooter with RPG elements. I think of Mass Effect as somewhere around a 70/30 split between RPG and action. It's a lot like Oblivion in that respect.
Oh, and someone likes Japanese RPGs better than Occidental RPGs. I'll send in my two cents: I think comparing a JRPG and an American one is like playing a rail shooter, we'll say House of the Dead 2, versus The Orange Box.
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