I guess talking isn’t a free action?

The standard grace rule is one sentance, not too long, or perhaps 2 short ones, and a reply of similar length are what you have time for in 6 seconds, or the length of one turn in combat in D&D.

In case you were being serious.

Given the golden rule of having fun, it also kinda depends on the tone of the fight.

Having a silly fight with silly talks? Go ahead and monologue.

Serious, possibly plot important discussion? That's something that you treat more seriously.

Typically my groups turn to allow a lot of talking during combat Dialog being half the fun.

Talking might be a free action, but active skill checks take actions. Diplomacy for negotiations with an NPC would take actions, and not be a "free action"

All of you forget that he is holding Zoro leg, I doubt that is a free action

"Fluff is fine but crunch takes time."

Seems like a decent rule of thumb. Another way to put it is role-playing counts as a free action, but roll-playing (or setting up for it) needs to take the time because it is directly of consequence in the game.