I don't know how worth it is to try to explain my idea of what a hypothetical better version of Starfield is, but the short answer is:

• only let you do one faction quest per playthrough
• those factions' quest lines already, in the real Starfield that exists today, intersect with one another
• change how different factions react to you and those other factions based on a system similar to the type of reputation system Obsidian has done before, not unlike Levine's "Narrative Legos" video, but it doesn't even have to be that advanced

It wouldn't involve grinding. If I still haven't articulated it well enough, don't worry about it, because that game doesn't exist anyway.