This shit was so annoying in the Resident Evil 2 remake. It spoils my perception of the clean-cut rookie cop Leon to have him swearing like a sailor every time I point my damn gun at a zombie. Claire comes off as an annoying dyke with the in-game dialogue, NOT waifu material at all.
The very best game to do in-game PC dialogue is Thief. Garrett's lines direct the player, enhance the experience of a level (I probably wouldn't remember finding the pile of corpses in the cellar of the Mechanist Cathedral if not for Garrett's memorable reaction) and, most importantly, are few and far between. When Garrett talks it's like a treat. Modern PCs never shut the fuck up.
Here's an interesting question: what was the earliest game you can remember having this problem of an overly talkative PC? For me, it's Ultima: Serpent Isle. Not only is the Avatar's dialogue often badly written and cringeworthy, but it completely disconnected me from my player character. For example, in the very beginning of the game, when the entire party is caught up in the teleport storm. Typically, in such a situation, you could think of your PC as maybe alarmed, but alert and resourceful, immediately scrambling for cover, thinking about what caused the situation, and planning a solution to the problem. But instead, the Avatar is given dialogue like "WOAAAAH WHAT THE FUCK'S GOING ON THIS IS FUCKING CRAZY MAN", etc, and he comes off as dim-witted, which is a problem throughout the entire game. For me, who had been carrying the same character with the same name for 6 games, it felt like I was being robbed of my own character.
This problem is worsened severely in proceeding Ultima titles (Ultima 9 is an infamous example of this, to the point where posting examples of the U9 PC's dimwittedness has become a tired meme), but Serpent Isle is the earliest example I can think of for any game.