Is it possible? Are there any mods that let me do it? I find it odd that I can draw my sword and stab random people at night, but not in the day. Feels like a very strange gameplay mechanic.

I'm guessing it t was a way to make killing kids impossible.

It's possible, if you encounter a hostile. You can draw it by selecting them. No other way short of mods, and mods probably can.

Ah well. Thanks guys.

So...how do we explain this away in the context of the game, just for fun? :D

I interpreted it as the game placing some limits on me so I wouldn't do something totally out of character for Geralt. This is also how I explained the fact that there were sometimes houses that I couldn't enter until I had a specific reason to, for example. These are limits on the freedom of the player, but they're not really that unrealistic, because no real person would actually go barging into every single house in the city like we usually do in RPGs. The game forces me to be civil, which is what I would actually do if I were really there, but too often in games I'm tempted to act really weird because there's no negative consequences, and I can usually steal some extra money from people's houses and stuff without having to worry about it.

I think that letting me run around and goof off and stuff would in some ways cheapen the game's narrative. That's not how Geralt would act.

Of course, some people prefer more open-ended RPGs and didn't like the Witcher for this reason, but I thought it was a nice change of pace from the usual RPG formula.

You can't draw your weapon any time you want, because this is not how Geralt behaves. The witcher is supposed to slay monsters, but even then using brutal force is not always necessary - hence the limitation.

As for other limitations in TW1 - we all have to remember that it's not a classical RPG. This game tells the tale of Geralt, the witcher, thus limiting our actions in one way or another. Sure, some people were not happy with this, but this game was supposed to be like this from the beginning. TW2 presents us with more choices, but it's still not an open-RPG - where you create your character, choose the class and are allowed to do whatever you want.

I see these limitations as a good thing in this case, although I also asked myself a question "why?" at the beginning :-)

"Butcher of Blaviken" did not involve any townsfolk ;).
I think that "kid protection system" may have evolved during the development and the game ended up with double security. Just a theory.
The safe zone system is particularly annoying in the trade quarter at night. I see a kikimore emerging but can't ready my weapon in advance.