There is a reason why Morrowind is a cult classic for a specific generation, and IMHO lies in a completely different category of cult classics than, let's say, Planescape: Torment and aforementioned New Vegas. Younger you are better and more flexible your imagination is, and Morrowind is almost the best game that's out there for impregnating your imagination. Setting is only thing that is legitimately a masterpiece in this product, and a lot of it depends on player reading these fucking books and reading these Almsivi-damned Wikipedia dialogues. Morrowind captured dozens with it’s world and imagination replaced, in memory, what sucked - that it almost everything else. There are some good characters (most of them transcended into memes years ago), there is a very strong backstory (not main plot, this one is shit, it’s only as good as player’s understanding of what happened at the Red Mountain), aesthetics are very strong (part of the setting IMHO), but rest? Jesus. Mechanics are completely broken and game goes fucking bonkers really easily, AI is shit, whole game design is fucking awful (OP highlights it well). The list goes on and on.
You can easily LARP in game and pretend that it's a good one, but that's only your aforementioned imagination doing it's magic.