Some random thoughts from old discussions on Sigil's boards...
Most game music should be elevator music; that is, music that affects the listener without becoming the main attraction. Star Wars themes like the Imperial march definitely grab attention during the movies, but not enough to distract from the action.
One of the things that makes John Williams so great is his use of leit motifs. The heroes (Luke Skywalker, Indiana Jones) have their own themes. The villains have their own themes (Darth Vader, Valdemort). Each setting has its own theme. Then he goes one step further and adapts the themes a little bit to the situation. More and better use of this in games would go a long way in augmenting gameplay.
To ensure players truly feel that the different legs of an epic quest are part of a grander scheme, use a musical motif. The player hears that epic's theme every time they are engaged in some action that helps to complete that quest (usually combat). Think in terms of Indiana Jones. The main theme plays throughout each movie, calling up a feeling of adventure and getting you actively rooting for Indiana. If done with multi-legged quests, the player's feeling of grand adventure could be heightenend in the same way.
Truly epic mobs could have motifs. The music would be unique in that it is tied to the mob's movements and actions. When the epic giant, for example, raises his hammer, the music rises. When the hammer comes down, the music comes down and slams with the impact. If the mob casts a spell, then the music builds up while it's casting the spell. It creates a cinematic game experience. And , in a sense, it's tailored specifically to that group's unique battle experience. If they interrupt the mob's spell, the music is interrupted.
In places you're sure players will go, views you're certain they'll see, give those scenes their own wonderful theme. A road with high walls on either side might lead up a mountain. When the player reach the top, you give them a wondrous view of the valley below and a sweeping musical theme just for that spot. If the view was memorable walking in both directions on the road, then the top of the mountain could act as a trigger for the music, and would play regardless of whether the player was just standing there, admiring the view, or if they were walking down the other side of the mountain, looking as they go. Things like this create memorable moments for players...moments they share with other players and remember fondly long afterward, reinforcing a pleasant perception of the overall game.
Sometimes silence should be deafening, as the saying goes. A dungeon is a great example. A dark, damp dungeon might have creepy, nearly-silent music; or no music at all. You hear every drop of water from the ceiling, every crackle of the lamp, and get goosebumps when you hear movement around the corner. When the attack comes, a lack of combat music forces you to concentrate on the horrible sounds the monster is making while it howls and claws; or you might hear the necromancer chanting a curse, or a cleric praying for intervention, etc.
NOT JUST ZONES
Divide environment music by semantic setting, rather than bland zoning. Don't just give a theme to the whole zone of Butcherblock or Mos Eisley. Have a main theme for when you're following the beaten path, a theme for woodman's shack along the road, etc. Change the theme expectantly as the player nears the goblin camp. If the music suddenly drops out, that will create expectation too.
If audio is used for cues and clues, you might make player actions and abilities affect the volume of sound effects. Perhaps one race has better hearing than another, so hear particular sounds when others don't. By keeping it about particular sounds, and not all sounds, it prevents players from just cranking their volume to hear as well (they still might, but when the sounds their character hears normally come around, those sounds would blare in their ears and discourage the player from trying to cheat again; they would be warned in the manual). Wearing particular shoes might lower the volume of footsteps. An archer power shot might make a louder thud than a quick shot.
In taverns and similar settings, I'd like to hear folk music. Folk music can take many forms (lively, laments, protests, etc), but it acts as a cultural and historical identifier. This might be something as simple as a lone NPC musician or there might be a full band of locals playing in a corner.
MINSTRELS AND NON-PERFORMANCE MUSIC
If you've seen Gangs of New York, you might remember the part where the Irish lady slowly walks by singing a sad Irish tale. Imagine having the occasional character like that in a game. The NPC might walk around town or they might walk up and down a road. You might even have the NPC following a road from one side of a continent to another. The NPC carries a sort of bubble of music. They walk around singing or maybe playing a fiddle or something; if you get close to them, then the environment music fades away and you hear that NPC's singing/playing. Then, when the NPC continues on, the environment music picks up again. It's a good way of making the world dynamic. A player usually walks by NPCs without a glance. But if an NPC is playing music, singing, then the player is sucked in. Such NPCs could include stuff like gypsy wagons rolling from town to town. Or it might be bards sitting on some steps, trying to win some coppers from passers-by. Or it might be a young boy whistling to himself as he fishes on a lakeshore.
PERSONAL MUSIC (mp3, wma, etc) PLAYER
Maybe you want to have the additional option of, or focus on, the player's own music. Then picture a system where you add tags to tracks, or download pre-tagged keys for songs (in addition to a standard set of genre tags like grunge, rock, rap, trance, classical, etc). You have tags for gameplay scenarios like exploration, combat, victory, conquest, etc, and an music player integrated within the game which would pull tracks that were contextually appropriate for whatever was going on within the game - cross referencing the music genre with the gamestyle. So someone that likes Metallica might get Enter Sandman as a musical backdrop to big battles. Someone who likes classical music might choose Flight of the Valkyries for their combat music. Of course, each music scenario could have more than one song to shuffle between.
There's a financial opportunity here as well. Assuming your game becomes popular, you can now contract with major record labels to create and sell scenario-music compilations; like a "best of [musical genre or era]" for combat, or for exploration, etc. I hope that's clear.
Use variations of ambient sounds to create, or enhance, the environment music. In Diablo 2, Matt Uelmen does this in the swamp town (the third starting town, whatever it was). You're walking along rotten wood, rope bridges and the music is done on marimbas and other wooden sounds. If you were actually walking in a swamp, I would probably use an oboe (it can have that murky sound) or a didjeridoo. If a player is walking a high mountain trail with shrieking winds, use airy flutes. Work in actual sound effects, if possible.
This goes for combat music as well. Combat music, if you have it, should vary in style like any other setting. Imagine something quick and eerie on a sitar while fighting a scorpion in the desert. Military encounters might include wardrums.
Games shy away from this, but it can be extremely beneficial at times. I want to hear understandable drinking songs, laments, hymns, etc. I want to hear reverent choirs. An ancient order might sing chants. There are dozens of choir styles (I'm particularly fond of Russian choirs). You don't have to hire professionals for this. Most people know at least someone with a decent voice, some of them quite beautiful or otherwise compelling.
Music and sounds can signal action or cause it. Belltowers signal time, and sometimes are the cue for events to begin. Ancient armies used horns signal attacks.
TRUE AND FALSE CUES
Audio cues like the environmental music dropping out in anticipation of danger can be made uncertain by false cues, like the music dropping out when there is no danger. Crying wolf too much will undermine cue music, but it might prove useful sporadically. True cues can be used toward many types of scenarios. A group might be wandering around a large, dark castle chamber in awe when a character passes by a hidden door and some noise, like the scuffling of a rat, hints at its location. The sound can be made subtle by occurring only the first time that character passes the door's location.
True cues can be made uncertain by the inclusion of false cues, like the music dropping out when there is no danger. Crying wolf too often can undermine the use of true cues, but it might prove useful sporadically. Also, music should not mislead players by having sounds that could be part of the environment. The best example I can think of is when I'm driving and the CD I'm listening to has a honked horn, causing to look around and see who's honking.
Sound effects should often not draw much attention at times, but it should at other times. The sound of the ringwraiths in LOTR was comprised of grating steel (gut-wrenching sound), little kids screaming (gut-wrenching sound), and dry ice among other things. For the Baalrog's roar, the foley designer mixed stone being crushed and fire. Innovative foley design for characters and creatures can be particularly important in creating immersion. Expectation plays a major role. If the player expects a beast to growl in a particular way and you offer just that sound, then that player might take no notice or might mildly think "cool". But if you offer a sound strange and far more terrifying that expected, the player's experience is significantly improved.
SOUND AND PHYSICS
It would be cool to hear the muffled music of the tavern hall while I'm in the inn room upstairs. A lion or elephant can be heard from over a mile away. Imagine hearing something like that, knowing a fearful sounding monster is somewhere not far off in a particular direction. Do you go that way to see what is making that awesome sound? or do you head in the opposite direction, steering clear of danger?
Some animal sounds are misleading. Here, in the subtropical region where I grew up, we've got tons of birds and bugs alike. But an untrained ear often can't distinguish between some of the bugs and birds. Some bugs are as loud as a dog barking. Some birds make a bug-like, scratchy croaking noise. So imagine a player hearing a non-aggressive animal noise and thinking "you're mine!". But, when they finally find the creature making the noise, it's not something they want to mess with (too late!). Or vice versa. Players move the opposite direction from a scary sound, which is really just a small animal (you must hear a Tasmanian devil; those things sound truly evil). Or how about a mockingbird or parrot? Some creatures might mimick the sounds of other creatures to lure players or scare them away.
How many times have you watched a movie or read a book where the main character steps on something, moves something and hears that horrifying "click"....and they just know something bad's about to happen (a boobytrap, perhaps). Foleys like this can be very memorable.
There's other stuff I could talk about, like combat music shifting with the turn of the tide in battle, but I'll stop there.