Lessons in writing, Internal Conflict

This has come up on several of my talks so I'll pick it up here. It's all part of characte creation. So are you sitting comfortably? Good, I won't be long.
Okay, we all know drama is CONFLICT, right? Simply put all stories are about opposing forces trying to get or do something. You want a good guy, you want a bad guy.
Or do you?
You've two types of conflcit, Internal and External. External is when the hero is out fighting some villain. He doesn't worry about the righteousness of his cause, he knows he's the good guy and it's as simple as that. Most war films and most Bond movies are all about external conflict. See the guy in the Nazi uniform? BAD GUY. You can bomb him, shoot him, do all sorts of violent and socially unacceptable things to him and no-one will mind. Seriously. Ditto anyone with a kaftan, turban and AK-47, KKK hood, Soviet uniform (for those of us who grew up watching 1980's action movies) or gang colours and generally people with a poor grasp of English or (ironically) a very good grasp of English (why are the bad guys always from English public schools*?). These are all codes for 'we're not engaging in any moral conflict issues here, so move along'.
Try and avoid these sort of stories. They are exciting, sure, but simple storytelling. They suit the visual medium better than the literary one, mainly because explosions don't work so well on paper, or Kindle for that matter.
Internal Conflict. That should be your mantra. The ONE THING books do better than any other medium is explore the inner mind of the characters. So give them something worth exploring. Doubts, self-criticism, confusion and moral dilemmas. After all, the entire canon of Russian literarture and most of YA romance is built on this! It works because it's what the medium does best.
There endeth the lesson.
(*Oh, for the Americans reading this, first, let me say 'Hi!' then explain what we in England call public schools you would call VERY EXPENSIVE private schools where the child needs to be entered more or less the moment they're concieved for any chance of getting in, unless they happen to own a country or small European principality, which sort of trumps everything).