Afer talking to Giles and the woman of which I don’t remember the name, they go to the tavern, meet and have a chat.
If you talk with them in there, every time one of them speaks they stand up, and their legs clip through the chair. Then they sit back down.
Here you can see Giles clipping through the chair. I couldn’t replicate the bug with the other NPCs in the tavern, but this continued to happen every time I talked to Giles or the woman.
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(One note: why is Giles dressed red here? Shouldn’t he be dressed green, like in the image on his dialogue window?)