I have entities spawning in my game now and when i control them with a input handler there collision works fine, however i was wondering if someone can help explain the basics of a non hostile
AI
I read a decent book once on AI. It came with some code.
I think this is a great place to start: https://github.com/idmillington/aicore
Cheers, ill have a look at this!
Although not specific to your question, here is a good source on Pathfinding and Graph Theory by RedBlobGames. It will come in handy some day, keep it bookmarked :).
Hmm seems intresting 
i might try and hack in the pathfinding to make rivers too 
since i am using altitude maps
Start with pathfinding, if you want npcs to move to certain places every once in a while you can just set the targetx and targety using your pathfinder.