Well, I came up with an idea for a ... thing. Its basically a low level wizard that, dureing a duel with another wizard, was polymorphed into a hat.
Now, while he can not move himself, he can cast spells and speak telapathically to who ever wheres him.
The question is, should he be considered an NPC or an intelligent item of artifact level?
He is a person, that is an item, and fits the roles of both.
I guess the best way to say it is he's an NPc that has a unique form of symbiotic 'construct' as his race, right?
He's an intelligent item.
Intelligent items are made from people stuck inside of items all the time, whether it be a demon whose essence is imprisoned in a dagger or, say, a wizard trapped in hat-form.
Intelligent items can communicate (usually) with their wielder (sometimes with others, too). And they can sometimes cast spells on their own as powers, too. The only question is: does this wizard retain full spellcasting abilities? How is that possible, with somatic components for which he lacks hands, material components he can't hold, and verbal components he can't speak (telepathy doesn't count, though if he had the speech ability...).
But that's just how intelligent items work in 3.5 rules as written. You can have items or item-creatures work however you want in your campaign.