Why have I not even mentioned that ._.
lol
Yeah. I had thought about that just the other day, like perhaps you have a full inventory and a quest giver happens to want to give you something, what do you do?
So, yes to both questions. Discarding items would be extremely helpful come to think of it, and if the inventory is full it would be AWESOME if you'd had the option to decide whether to toss that item or another within you inventory.