From a comment made on a recently locked thread.
Probably the least favorite thing about the system to me is skill challenges, which feel poorly structured and ill-explained; the scenarios skill challenges describe are, to me, the most fun sequences to role play, and telling players, "You can use these skills X times, and you need Y successes before Z failures" makes a story element far more mechanical than it should be. (Of course, I'm new to running this system, so maybe I'm just Doing It Wrong.)
Two quick tips that will help significantly here.
Don't tell the players that they are now in a Skill Challenge and don't get to bent out of shape trying to get everyone involved by asking them what they are doing or telling them which skills to use. Just tell them the situation they are in and let them tell you what they are going to do...then ask for rolls. The best skill challenges don't involve the DM leading the action, let the players lead the action.
There is a lot more after this, and even here there are exceptions where going against my advice is actually a better plan, but start here and you should see a significant improvement right from the get go.
I agree the best use of encounters, including skill challenges, is when you don't throw it in the characters face, but rather let them be the guide. And if a challenge succeeds or fails, don't advertise it, except to let the characters know what happens next. The only downside to skill challenges, or skill rolls in general, is when players optimize on combat skills.
I might have to remember this should I run a 4e game any time soon. Skill Challenges were the one rule that utterly disgusted me in 4e because my first exposure to it was in a role playing scene and I thought "Turning RP into a combat mechanic?!?! WTF?!" I mean a roll to see if that argument to posed convinced the lord to give you some resources, sure, modify it if the PC made a really good argument and there you go. But initiative, 'rounds' successes vs failures? Got too damn convoluted for me.
Probably didn't help that my first exposure to Skill Challenges as a player was strictly as written. Where the DM had people roll initiative and just had us roll different skill checks, about as much role playing as you see in a game of Solitare.
I guess what I'm trying to say is "Thanks for the good advice!"
My feeling is that Skill Challenges really are 'hard mode' for DMs. Its difficult to make them work and, even with some experience, I probably come out of any given Skill Challenge thinking 'that could have gone better'. I don't think there is any part of 4E, with the possible exception of adjusting to higher level play, that I need to learn more about then Skill Challenges.
All that said there are really significant reasons I keep using them. I recently went through a Skill Challenge as a player that was not as great as maybe I would have liked and realized that, after everything was said and done it was still worthwhile - even in not being the best, most fun I could be having at the table it still added to the story and it was therefore still worth it. It is in understanding their potency in filling out the story of our fantasy game that makes me stick to using them and continuing to try and improve how they go off every time they come up.
To understand their utility I want to try and draw attention to where they exist in our role playing games - what space they fill. Essentially they exist in the space between DM flavour text and a full on outline of a specific scenario meant to take up a significant amount of game night.
I'll give an example of the not particularly fantastic Skill Challenge I went through as a player. In that session we are in a large fortified city under siege by a huge army of Orcs. The Orcs are lobbing flaming rocks into the city from large siege engines and buildings are exploding and fires are raging while the common folk are screaming and panicking. The attack is imminent but has not yet started.
So what happens here is that you want to spend some time role playing what it is like being in a city under bombardment like this. Its a powerful background scene and it seems a shame to just skip over it in a few lines of DM flavour text - there is a lot of potential for character development here and this is really where Skill Challenges can come in. In our case we end up trying to get in contact with a member of the city council - an ally of ours.
Well when we get on the scene we find that she is trapped in a burning building. We proceed to try and save her from the building in what is a Skill Challenge. Note that by using a Skill Challenge here we have focused the 'camera' on this specific scene in particular and more broadly we have begun to tell a story about what it is like being in the middle of such a dramatic bombardment.
In older editions of the game there really where two ways of handling this scene. Either it is all, or almost all, DM text - maybe with the playing piping up once or twice but more or less the DM describes the dramatic scene and the players say 'and what happened next'? Or the scene was converted into the rules system itself. In other words there was a floor plan for the burning building with descriptions of the rooms and challenges and obstacles along the way. That is a great premise for a nights gaming but to be a worthwhile D&D adventure you need a whole bunch of other props, a much more complex plot - bad guys to fight, sub plots to discover etc. If you just want this to add to the narrative but not be the focus of a whole session that is where a Skill Challenge comes in. It took us about 15 minutes to deal with the burning building scene, much more significant then a DM narrative and it gave us a lot of flavour but it was not the nights gaming - it existed to highlight the bombardment and to build tension for the attack itself (which was really the nights gaming).
Hence, fundamentally, this is usually where a Skill Challenge fits in - a scene that is too good or too important to gloss over with some DM flavour text but is something that is not important enough or large enough to be the focus of tonight game.
In the end I realized that, even though it was not the greatest scene of the night (that was when my cleric dismissed the undead dragon in the final battle for 5 rounds or some such) and I felt that it played out a little stunted it still added to the narrative of the story being told - it amped up the atmosphere and it was totally worth it in that regards.
I think broader skill challenges may be the ticket, if you view designing encounters as a layered process. This is similar to setting a stage for a play, where you can start with basic things like room layout, itemization, terrain, etc., and then step up to social encounters or acts, where you may transition the mood or feel, and then the climax where you may be fighting creatures, disabling traps, etc. Each layer is a means to relay information to the characters. The key is not to focus too heavily on a specific layer, but to weave them together. Most people experience skill challenges as a seperate experience, where you may roll initiative, and then go around the table. If you take a layered approached, then the characters at any given time, can use mulitple tools at their disposal to move the story forward. The above would also be my approach for a sandbox environment, where mulitple layers of adventure design may lend clues to how each element is related to each other, and provide a sense of purpose (even if some layers only have a casual relationship).
I think the main thing that's i've come to feel is that Skills need to be looked as very broad knowledges, techniques.
Streetwise- You can use this to blend in with low end of town and 'talk the talk' with the locals. Searching the backstreets for someone (tracking).
Insight- to sense a crowd of people for people who fit in and ones that don't(maybe disguised killers or people on the run).
Thievery- Can be used for things like gambling (cheating), in conjunction with Insight to read other players.
Dungeoneering- spot a better rock face for climbing, is used in conjunction with Athletics. Spot and Search for pit traps in solid floors.
Acrobatics- Dancing skills for social encounters or using an agile twist and spin before a bow to help with social encounters.
History- to recognise where you are in a town by known buildings(crosses with Streetwise to navigate a town). Tell the characters story/ relate events.
Heal- explain to a noble lord you can help his people by teaching them his chirurgury skills( explain his techniques).
Basically try to find where the skill can be used, even crossing some skill uses.