Yeah, it has to be decided. I think it has to be stated explicitly, and that all the players have to agree to it candidly, before anyone settles on what character they’re going to play. I’ve had too many bad experiences that amounted to a character-player forming an unshakeable opinion that “my character wouldn’t do that”, the root cause being either
- that the “unspoken agreement” wasn’t actually agreed, or
- that either the GM or one or more character players wasn’t candid.
But however it comes about once they have designed a character some players become very inflexible about playing out of character or adjusting their character once generated, and I don’t believe that they are being wilfully difficult.
When I’m pitching a campaign I like the “the PCs are X who do Y in world W” formulation, but sometimes I get a (or rather, used to get) more of an “please run some W for us” or “what shall we play?” approach that brainstorms and negotiates its way to an agreement during Session 0.