I, for one, actually do play the game in question, and I have three comments.
1: HA HA! Nice job hitting the 'randomize' button! That's a good way to pump some nightmare fuel all over your screen.
2: I think you're probably overthinking things a little when you connect a game like AG3 to pick-up artists and people who think there's a 'code' for getting women to be attracted to you and all that rubbish. I'm sure there are some people out there who ascribe actual personalities to the girls in their artificial harems, but for the rest of us it's much less about simulating relationships and companionship and much more about having customizable porn.
To put this in a bit more familiar perspective for most gamers, have you ever played Quake 2 (or a similar game) and found yourself thinking, 'Gee, this is a fun game, but I wish I could be playing as Optimus Prime/Snake Eyes/Neo/Daffy Duck/etc. instead of John Doe McSpaceMarine.' I'm not the only person who thinks this way, because, in its heyday, there was a largish community dedicated to producing alternative character models for use on Quake 2 multiplayer servers, and all the characters listed above where included.
Going back to porn, I'm sure you've all been in a situation where you've been watching some hot hardcore action and thinking, 'Gee, this is nice, but I sure wish I could alter the female lead's facial features and body structure so that she wasn't UGLY AS FUCKING SIN.'
QED, I think.
Granted, for AG3 to be able to do this for you, you have to be into the whole 'anime/game girls are hot' thing to begin with; too bad Illusion is really the only company to put some production value into this business. Anyway, the problems with the creepiness of girl creation/the town/the hugging all go away (mostly-Even I get a little creeped out by this game at times) if you stop thinking about AG3 as a relationship simulator and see it for what it is. For lack of better terminology, it's a virtual action figure factory and a nice big playset to mess around in. Not exactly Ninja Turtles with Sewer and Technodrome, but it's the same general idea.
And yes, there are most certainly aspects of 'relationship' simulation in AG3. Quake 2 also had a storyline about alien invaders and whatnot. Neither game is interesting for the elements needed to provide the context. You play them for the action and that's really all that counts in the long run. If you think that such a scenario can even come close to replacing real human interaction (I certainly don't) then you need to go watch ZP's review of The Sims 3 and get some perspective.
3. Not all dating advice-providers on the internet espouse the theory that all you need to know to be successful with women is a specific course of actions. Only most of them. A few; like the Double Your Dating series for instance, emphasize personal improvement, self-confidence, and understanding the intricacies of sub-lingual communication as being much more important than any techniques when it comes to being good with women. The point is that not everyone sees women as a puzzle to be solved, but more as a skill or set of skills to be learned; understanding the context and learning how to work within a variety of situations are the keys to success, just like any other discipline.
P.S.: I've come to terms with the fact that I'm a lonely, socially awkward weirdo who plays dirty Japanese games. Feel free to call me on it, but short of pointing me at a good therapist I don't think it's going to do much good.