This game punishes you for trying to play with your friends

Got it working actually. We were just dropping too close to base.

How do you play coop in this game?

Best off googling a guide. I've forgotten. It works quite well.

Complete the prologue. When you see the inscription "camp establish", it means the prologue is completed. You and your friend must have the same active quest. In the settings, disable the companion's AI. Set the code (any numbers), it must be the same for both you and your friend. Enable the checkbox "use multiplayer code". Leave the camp. For example, go to the stone bridge over the river (there is a single enemy with a shield). Wait a few seconds, you should be connected. Each camp is different, so there will be a disconnect there. Every time you leave the camp, you will need to repeat the connection procedure.

Despite the above, I still haven't managed to play with a friend. We just couldn't connect. (the connection worked even on a pirated version, 5 years ago, but not on Steam, lol).

Ok, we managed to connect.

There are areas near the main city where the connection is very poor or does not happen at all. This also applies to the stone bridge I wrote about above.

Not far from the stream there is a cave (where the shadow stands), and in front of it there are two savages. After killing the savages, we connected in 99% of cases. In all other locations of the game, the connection was without problems.

Here are some of the conditions that we followed:
1. Neither you, nor your partner, nor your bot should be in combat. Finish the fights. This is not necessary, sometimes we connected right in combat, but this was an exception to the rule;
2. We set a code like "112200". My partner read somewhere that the last digits should be two zeros. It sounds like a conspiracy theory, but as soon as we did this, we immediately connected and for the next 60 hours there were no problems with the connection;
3. You have to be in an open space. You won't be connected if you've entered a dungeon. But there shouldn't be any problems in simple caves;
4. You have to have the same main quest selected. You have to be at the same stage of its completion. But I'm not completely sure about this point;
5. Don't go too far from each other;
6. You don't have to turn off the bot.

It's the town that stops you connecting. I don't know why, but you disconnect automatically in town.