So here is a pretty interesting article about the ludonarrative dissonance, using games like Bioshock and Mass Effect as examples.
This concept is something that I think every game designer/game story writer should have in mind, as the break in immersion can really effect the immersive aspects of the game in a negative way. Take Bioshock for example, one thing that always bothered me about it was that while the game tries to present this kind of commentary on Randian philosophy, it so rarely made me think about it in terms of gameplay. Even the little sisters don’t have that strong an effect because both choices could be seen as something of self-interest (especially when the ADAM seemed to come in just as much quantities for saving as it did for harvesting them).
I think there are a lot of good models out there for how to have a properly adjusted game world to prevent this kind of dissonance like the Bethesda games and Fable, but I think often times the kind of games that would get it right, would conflict with what gamers think they want, so a weird compromise has to be made.