I've got to side with those who think Daggerfall is boring and soulless.
I bought it when it first came out... 1996 maybe? I was really into it at first, but after about 20 hours I started to feel like something was lacking. I'd done a handful of guild quests, and one or two of the main storyline quests, but I was already feeling like I'd done everything. Once the guilds started giving me quests to kill a different monster in a different randomly-generated dungeon on a different part of the map, I got bored. And those non-quest-related dungeons were sprawling and repetitive and seemed to go on forever. Daggerfall gets a lot of praise for having a realistically-sized world, but the existence of hundreds of endlessly sprawling dungeons doesn't make a lot of sense.
Everything in the world feels the same. Yes, there are thousands of NPCs, but none of them have any personality whatsoever, there are a limited number of character graphics per area, and they tend to say the same things. Towns are realistically-sized, but that makes them incredibly tedious to navigate and find what you're looking for. And one town in a certain province never really felt that different to me from any other town in the same province. Yes, Daggerfall (and Arena before it) was ambitious, but even the much smaller, hand-crafted Morrowind still feels rather soulless and repetitive to me. Ultima VII had a comparatively much smaller world, with a very scaled-down population, but it felt alive. It had a soul. Yes, Britain only had perhaps 20-25 buildings and 30-40 people, but it took hours to explore everything and talk to everybody. Daggerfall feels like playing an MMORPG by myself. I couldn't make that analogy at the time, obviously, because there weren't really any MMORPGs (maybe Meridan 59, but I never played it).
Thousands of potential quests don't mean much when they are all variations of "go to dungeon X and retrieve Y for me" or "go to dungeon X and kill monster Y for me." Or replace "dungeon X" with "X's house." I tried walking from one town to another once, because they looked to be very close together on the map. After half an hour of incredibly tedious walking, I hadn't gone even half of the distance. Just half an hour of looking at the same tree sprites over and over. No monsters. No weather changes. Nothing. I can't imagine ever not using fast travel in Daggerfall. And the horse? Wow, paste a poorly-drawn, non-animated horse's head at the bottom of the screen and make me move faster. That was pretty laughable. Part of good game design is knowing what not to include if you can't pull it off well.
And of course the bugs were legendary. I fell through the floor and into the void countless times in dungeons. The version I bought had this nifty "feature" where you could simply click on the border next to your attributes (where the arrows appear on level-up) and increase them at any time. I'm pretty sure the first patch fixed that though.
Daggerfall is also the only game every to completely trash my computer. I played it on my old 486-33, and I had three hard drives on the system: a 240MB, a 40MB, and an 80MB. While playing Daggerfall, my system froze completely, and I had to power down the system and restart. Except my PC wouldn't boot up of the hard drive anymore. I tried to run Norton Disk Doctor, but it couldn't read the drives. Even FDISK reported that there were no partitions on any of the three drives. I ended up having to repartition all three drives and I lost everything. Of course, I can't reasonably blame Daggerfall for this. I think.