Back a year and a half ago or so, I introduced my players to the most irritating, burr-under-the-saddle, thing you love to hate imaginable. A rival party of NPCs; the Red Seekers.
There were as many in the NPC party as there were in the players’ party. They weren’t evil per se, but they were everything the PCs could ever hate. They were a few levels higher than the PCs (but not enough to allow them to completely steamroller the PCs), and naturally as the PCs gained levels, these guys did too. They were a little richer (making a point of renting the best rooms in the only inn in town, usually only a few hours before the PCs got there). They had slightly better magic (“oh, you don’t have magic missile in your spell book? What a pity!”). They waived around an “official charter” from the Duke of Tenh Himself, declaring them to be his official agents, treasure seekers, and troubleshooters. Oh, they *loved* that charter and the status it brought.
But worst of all, they were arrogant, and condescending towards the PCs, and constantly rubbed their nose in the fact that they were oh-so-slightly beneath the NPCs– but never in a way that was overtly insulting. Just always with the smirk and the grin amongst themselves that nobody else seemed to catch except the PCs. And they all wore those red cloaks. Those damned smugness-inducing red cloaks.
Oh, how the players hated those guys! And they couldn’t really do anything about it, because they weren’t evil. They were just… jerks. And had a habit of showing up and stealing the PCs’ thunder.
It was a great time playing encounters between the PCs and that NPC party. Not everywhere, of course; too much would spoil the broth. But every once in a while, there they’d be, and the collective groan that emanated from my players told me it was so wrong, but oh so right.
I would encourage other DMs to do something similar. It’s a not-threat; certainly they won’t pose a threat to life, limb, and loot, but rather to dignity. It also allows for an opportunity to inject a little comic relief into the game (an absolute necessity when there’s a lot of Serious Things going on; breaking the tension with humor, when done with a light touch, makes the campaign all the better). The trick is to make them essentially bullet-proof, but only because the players don’t have an excuse to knock their blocks off, no matter how hard they might want to.
Eventually, in my game, the NPCs got their comeuppance, and the PCs were able to roll a little night-soil downhill on them (figuratively speaking), and that was hailed as a great victory and was a quite cathartic episode. But they’re bound to make a comeback. And I will definitely look forward to that collective groan when they do.