Red circle-y bits added by myself, obviously enough, and difficulty is nightmare, if it matters. Campaign is embers, but the effect happens regardless of which of those you're in. So, what you're seeing, is every enemy on a mapped tile having its position revealed on the minimap. This isn't unique to towns or pre-lit maps, and will function the same for areas revealed normally, or through something like the burning star's activation or a cast of earth's eyes. If you'll look at the circles with a line above them, you'll find the position indicated on the minimap, also corresponds to a blackened tile in the main play area. Both the minimap squares and the blackened tile will update as the creature in question moves.
... the import of that is, hopefully, fairly obvious. It's not quite telepathy levels of intel, but when combined with that lovely thing with inspect creature where it'll work even if you don't have line of sight on the creature in question (or it's invisible, or stealthed and unseen, or inside a closed vault, or...), so long as you're right clicking on the correct tile (the tile you know something is on, due to the map stuff above), well. I hadn't actually had eyes on that line indicated circled square, nor used track or anything similar, and the creature there hasn't been aggro'd, yet, but the enemy sitting on it is a sunwall guard :V
The other circled one is Isythra the sun-mage, a wyrmic rare. It has no talents that deal knockback (and thus potentially cause me to one-shot myself), and as such is a complete non-threat to my arcane combat using psyshot adventurer
