In this paper, we discuss approaches to dialogue in interactive video games and interactive narrative research. We propose that situating interactive dialogue in the simplified expectations of video games is a profitable way to investigate computational dialogue simulation. Taking cues from existing physical simulations such as combat, we propose a hypothetical game environment and design goals for an embedded interactive dialogue system. We present a modular framework targeted at that environment, which is designed to enable incremental development and exploration of dialogue concepts. We describe this framework together with a work-in-progress system for simulating simple in-game negotiation dialogues.