What in goodness name is there to explore in Morrowind? Went all over that world and all I found was a load of rubbish and mud. I have never been able to understand how anyone could find exploration in Morrowind interesting, neither do I understand it when said about Skyrim. Both games look absolutely atrocious, I don't mind old 3D--I quite fancy it--but there is hardly anything to see in Morrowind, or find, or experience; point is, don't get what part of the notion of exploration could be satisfied by Morrowind.
I really enjoyed hearing somebody mention some ring in a tomb on the other side of the island and then the subsequent journey to recover it. I may be falling into LARP territory, but that shit appeals to me sometimes.
For the time, I thought it was a well constructed simulation of a fantasy society, with static, but existent economy, political structure and cultural tradition. I liked walking around and learning about that stuff.
I liked exploring to find slaves to free.
I liked travelling to remote ash wastelands to find a small settlement nestled in the only cover the landscape provides.
It kind of sounds like you're implicitly limiting exploration to one of two things: better loot (making exploration secondary to acquisition, which is itself secondary to combat in most games) or beautiful stuff to see. I think Morrowind's strength wasn't the graphical presentation of its world--it's what of the world it chose to present, including religious texts, farms, pornography, weird art, political tension of sorts. The reward for this wasn't loot, it was seeing more of the world itself. It was appreciating the abstract world, the linkages between it and the game world, and the linkages between different parts of the game world. So it may be a lot of mud, but it's mud with its own history and art, with people wallowing in it, and that's what I liked to see.
Sure, it's not best game ever material, but I'm not going to pretend that it wasn't an enjoyable part of the game.