Will killing guardsmen affect how people interact with you?
Inside palaces in Arena (or at least in the palace in Rihad, Hammerfell) there is a back area that when you begin walking inside it says "Restricted Area! Authorized personnel only!" If you continue walking in there, which I did, a Warrior will come back and attack you. I killed the Warrior and walked back into the Main Hall without anyone else attacking me, but will people in the palace like me less now? Or will I become a felon and guards will attack me?
Or does the game not have anything as advanced as that and it will progress as if nothing had happened? Thanks!
The Elder Scrolls: Arena has no crime/bounty system like later games in the series. If you kill the guard sent to stop you, there will be no negative consequences whatsoever.