I have an undergraduate and a graduate degree in Psychology. I spent three years working at a facility for the mentally ill that were trying to integrate back into society. Most never had a chance in hell of doing this, but they still worked towards it.
So naturally you might think that I would like to see mental illnesses represented in RPGs.
Well that would be wrong.
I think Call of Cthulhu does it right. I think the True20 "Shadows of Cthulhu" also does a good job on representing them and does a great job with their mechanics. Many horror games make a good attempt, but others fall short.
Here are some of the things I hate the most.
1. Most severe mental illnesses are debilitating if not treated and cared for. In today's world we have doctors, medicines and support systems so people with mental illnesses can live a relatively normal life. That is not the case in many games. In Call of Cthulhu for example characters often go shit-eating crazy and that is the end game. But in other games people use it as an excuse to act like an idiot or an asshole, or both. Often both.
2. Schizophrenia is NOT "Split Personality". They are not even close. Having schizophrenia is grounds for a character to removed from play. Split Personality, or Dissociative Identity Disorder is so rare that I can count the case I have know about on one hand and still have enough fingers left over to give you the thumbs up, the peace sign and show you my wedding ring. A lot of games use this as an excuse to allow characters to do thing they could not otherwise do. In that case, multi-class.
3. Chaotic Neutral is not "Insane". In my games Chaotic Neutral is not insane. Nor should it be in anyone's game. Chaotic Neutrals should be loners, often anti-social, often assholes. OR they could be happy go lucky, but if they are on the happy side then why are they not Chaotic Good? Alignment is a moral and ethical stance, not a mental stability one.
4. Most games should not have Insanity Rules. Players don't know how to use them, Game masters don't how to run them and I'll go a step further and say most designers don't know how to write them. A rule of thumb. If you are playing in a time period that lacked mental health care then there is no such thing as insanity. Yes there are mental illnesses, but insanity is a legal definition and often a societal one.
Fantasy RPGS like D&D should never have insanity rules. Horror games should, but handled correctly. Modern games can have them, but should avoid them; games like Spycraft and James Bond they might make good plot points, but avoid using them as a means to get points.
5. If you are going to use them, use them in the time they are given. I said games like D&D should not have them and that is correct. People were not insane, they were possessed by evil spirits. A cleric with Remove Curse or something will clear that up. If you are playing in a Victorian age game, then use Victorian notions of mental illness. Talk about "floating organs" and then apply to appropriate remedy.
Now full disclosure time.
I have written a number of different takes on Psychoses for games over the years. I have never been totally satisfied with any of them. Most recent was one for Mutants and Masterminds based book that sadly will not see publication. I like the mechanics of that one, but the representation was not my best work. I did one for Ghosts of Albion too. I tried to fit it to the Victorian ideas of mental illness the best I could AND still make it compatible with Eden's other books.
I also did one for Ravenloft that I liked at the time, but now see it as coming up very, very short of the mark.
And lets be honest here. Player Characters are all insane anyway.
Rushing into dungeons, killing monsters in their lairs to get a gold piece here or there. Digging through obscure and forgotten texts to discover not only are we insignificant specs in the universe but the universe is so freaking dangerous we should just hide under the covers or any of the other 100 things we have our characters do.
We don't need a game version of the DSM-IV, we all need therapists.