Coming from a time when the only way to get through an RPG was to talk to EVERYONE I found that this still has great results in The Witcher. However I have run into dialogue options that seem to upset the character I'm talking to so much that they refuse to talk to me any more. Some of these characters seem like they could be useful or are somehow important to the game. So far I have either panicked and reloaded my last save, no matter how far back it was, or I quick save before every conversation. Am I over reacting? Will these characters eventually cool off and converse with me again or am I right to tread lightly in every conversation?

Dont pick dialogue options that piss people off, unless you want that.
I can't remember that you could piss off important people.

The problem is I don't know what dialogue option is going to set them off until it's too late. Some of the options don't even seem that offensive. Sometimes it's even something is not only innocuous but should lead to more conversation. Something like "I think you know more than you're telling me" which I half expect to lead to some sort of fetch quest to earn trust but instead I get "Piss off Witcher" whenever I try talking to them from then on.

Often if characters stop talking to you, they'll do it again after some time, or after you leave and enter the area (which shows a loading screen).

That helps. I'll test that out, Thanks

You are overreacting.

Lesser NPC's cool off either after time passes or you simply leave/re-enter the area.

Rarely, there are important NPC's who don't cool off, such as when you flat out accuse them of a criminal activity in Ch. 2, for example. But even then, there are always other ways to progress the quests.

There must be about 5 ways to get through the main quest in Chapter 2, for example. Some of them allow you to completely bungle almost everything, even still you will get to where you need to be.

Yup, this is one of my favourite quests. It involves failure as a part of the game, not creating a failgame state, forcing you to restart, putting you on rails through punishment. Instead you actually suffer consequences of your actions, which is much more immersive than being forced to restart over and over again so that you can go down the one or three paths the designers wat you to see.

So don't worry. As long as Geralt is alive, you've done nothing "wrong". If youwant to do something differently, save it for another playthrough, it really is more fun this way!

Groovy. I'm just going around saying whatever I want to whoever I want without caring about the consequences!

This game is so much like real life.

Actually it kinda is. Look at quests in other games: let's say it's an escort mission. Your ally dies, you are forced to reload. In real life you'd have to live with the consequence of that, and probably many things will get harder as a result. If your story-telling is structured so that a minor failure causes the story to end instead of changing, it's not a good strucure for an interactive medium.

And the fact that you got scared to offend NPCs is a wonderful example of that! Many games would not give you the option to offend anyone, you'd click and go through a dialogue that's basically a cutscene, because no matter what you'd say, the effects would be the same!

So it's great that you care :-) Both on your behalf (since you emotionally connect with the story, which is amazing!) and on behalf of CDPR.

Just don't let your worries take away from the fun. You'll do fine.

Chapter 2 you can really fail at talking to people and it changes the quest a bit. Its quite interesting.