My first exposure to this was Phantasy Star Online on the Dreamcast. My mind was blown.
Such a shame more games don’t use this. It worked for PSO because fights were relatively drawn out/telegraphed, so there was always a chance to build up/slow down the music.
I wonder if AI could get used to dynamically generate a transition between battle/overworld themes. Or at least, if the composer makes one and use AI to make all necessary versions.