Fable 2, i believe, you can play both on and offline CO-OP.. and yes, they can only play as a henchmen who either: Has your powers, or the powers they're own characters stats. (strength, desteriity, willpower etc..) but have to choose from a preset of designs. And the coop thingy is interchangeable, so you can do coop, then they leave and u keep doing the story / whatever it was you were doing before hand.

Because it is your own 'world' and they are your henchmen they have to follow your screen, and you control the safety functions.

I hope this helped.