SureAI

When you have to go from the Sanctuary to the the east with Kim, so that you use the silver plate, Kim is a total pacifist. She will only heal, but absolutely not attack or defend or flee. I was lucky that I did that quest at level 19 so I was able to take care of the monsters by myself, but had I been level 10 or so, it would have really sucked.

I had this problem later on - just quick save and reload. Fixed it for me.

I had this but she will fight later after you get past waverock, Well she'll paralyse you more often lol

Her AI really needs sorting though, Mage with bow ??
All she'd do is paralyse me from long range or get close in with fists when i was all ready there...
Maybe include some iteraction with her, I had the Chaos bow & hundreds of silver Arrows for her when she was still using Steel,
And oblivion engine wont allow reverse pick pocketing with items > 1 weight

Strangly though, She uses her Bow a lot more and becomes little bit more helpful after arriving at Ostian, healing & Fighting
When She asks if she can come with you, I said yes. Done fair few side quests waiting for Callisto.....

I didn't seem to have this problem with her, but then when I discovered she couldn't be killed I used this to my advantage.
I would draw the attackers to her as for some reason they always choose to attack her rather than me anyway.
Then when they are attacking her and she is fighting them I'd pick them off with fireballs.
She doesn't seem to mind getting some friendly fire and she always heals herself up afterwards.

Well, she did that to me again, when a small group of soldiers attacked the monastery. She will just sit there doing nothing. Loading the game didn't seem to fix her.

I don't understand Oblivion's AI engine, but then again apparently nobody does. What MAY explain the situation is the following: Maybe your and your allies (Callisto and the rest of the monastery) are the first to attack the soldiers, so Kim believes that you are the aggressors, and doesn't want to help you at this (although she won't go as far as attachking you; I believe that her script prevents her from that). Or maybe she is just too far from the fray.

But all the other NPCs I was with, before and after never had this problem, they all behaved properly. Maybe there is something wrong with her gear or some flag being set wrong?

Ok, the later Kim missions seem to have fixed her.

It's not the later missions... Kim automatically gains the right AI once you exit the game and start it again.