Crazy Awesome: Divayth Fyr is considered this by most Morrowind fans, due to him being a 4,000 year old wizard, collector of Dwemer artifacts, and slightly crazy genius who surrounds himself with opposite-sex clone wife/daughters, diseased zombie-esque maniacs and the last living dwarf.
Jiub. His badass appearance, the fact that he is the first character players encounter, the fact that he is a fellow prison-ship prisoner along with the player, and his friendliness all make him very popular with fans, despite only having a few lines before being put... or rather, kept on a boat. There are a few mods that bring him back and add quests centered around him. Later, in Oblivion, there is a mention of him having been canonized as a Saint for ridding Vvardenfell of all Cliff Racers. Finally, in the Dawnguard expansion to Skyrim, he returns in person! The player can encounter Jiub while wandering the Soul Cairn, where soul trapped individuals eventually end up; as it turns out, Jiub was in Kvatch just in time for the Oblivion Crisis, and his soul was captured by an invading dremora. Although initially somewhat oblivious to his true fate, he asks the player to collect pages from the first part of his epic twenty-six volume Opus, The Rise and Fall of Saint Jiub the Eradicator Hero of Morrowind and Savior of the Dunmer.
Fridge Horror: The in-game explanation for the lack of character schedules is that one of the early symptoms of the corpus disease is insomnia. This means that everyone on Vvardenfell is infected, and with Tribunal it's spread to the mainland (despite the travel ban) and with Bloodmoon it's already spread to Solstheim, so perhaps even Skyrim is endangered.
Game Breaker: Players can brew potions. These potions are more effective depending on how high the player's Intelligence stat is. However it is possible to brew Intelligence-enhancing potions with dirt-common ingredients. The Intelligence buff you get from that can then be used to brew even more powerful Intelligence potions, which can be used to brew yet more powerful Intelligence-enhancing potions. This can go on as long as you have enough ingredients (and as noted, the ingredients are very common.) When your Intelligence stat has reached the desired level of godliness, go ahead and brew whatever over-powered mega-potions you want—from Restore Health 9999 Points on Self for 9999999 seconds to 100% Sanctuary on self for 999999 seconds to Immunity to Magicka/Frost/Fire/Shock/Poison/Normal Weapons on Self for 99999 seconds. Creating a potion of Fortify Agility will mean enemies will always miss and you will always hit, although you can still be hit by magic.
Also, the Corprus Disease. The effects of the disease boost your strength and endurance, but drains a host of other attributes. Both gains and losses from this are cumulative over time, meaning that if you go to sleep for a year, you'll have 0 in the drained attributes, but a strength and endurance in the hundreds. When you finish the relevant quest, only the drain is removed.
To make matters worse, they're also very capable of infecting the player with a disease.
Slaughterfish are the watery equivalents: the player needs to barely dip their toe in the water, and it'll be snapped out by a ravenous hungry piranha. It is almost literally impossible to enter any river, lake, or sea, without the battle music starting and soon getting swarmed. Thankfully, much less of the game is spent in the waters, they die easier than cliff racers, and of course can't follow to the land, leading into them being rather overshadowed by their flying cousins - but in any other game, they would still be the worst enemy ever.
Thankfully, neither of these creatures spawn anywhere near Solstheim (although a single cliff racer appears as a stuffed trophy in the Skaal village), making the Bloodmoon expansion a refreshing breather from the rest of the game. Of course, the expansion does have its own over-abundance of Wolves and Tusked Bristlebacks, but at least they're easier to pick off than the other two, if only because they neither fly nor swim.
Good Bad Bugs: Some of the Ash creatures have vigorous running animations, but the creatures actually move slowly. This leads to an effect that looks like slow-motion running, a la Baywatch.
Because potion effects stack, if you drink two sujammas, your Intelligence attribute will be drained entirely, but once the effect wears off, your magicka reserve will be restored entirely.
Growing the Beard: While it traded away some of the size of the open world, Morrowind made it far more focused, giving it much greater content density, with defined geography and distinct towns/dungeons/villages (as opposed to the randomly-generated terrain and countless generic cities of Arena and Daggerfall) and characters that are fleshed out instead of being nameless masses like the first two titles. It also made the plot much more freeform compared to Arena and Daggerfall.
Hype Backlash: Not so much back when the game was first released, but later from fans of the series who started with Oblivion or Skyrim and then went back to try to play Morrowind. Most heard veterans of the series (particularly on the official forums) hyping the game up but were underwhelmed when they went back to play it in comparison to the newer games. Most of the complaints were toward the obtuse quests (Morrowind laughs at your desire for quest markers), dice-roll oriented combat system, and graphics which look rather outdated by the standards of later games.
Idiot Plot: It is way too obvious during the main quest of Tribunal that Almalexia is becoming insane, yet the Player Character is supposedly clueless until The Reveal at the very end. Until then, you have no choice but to carry out all of her crazy commands if you want the game to progress. Granted, this can be subverted by just killing her on the spot, but only if you don't mind cutting the questline short and not obtaining a free set of Royal Guard armor or the ability to instantaneously travel between Vvardenfell, Mournhold, and Sotha Sil's Clockwork City (and potentially being cut off from the rest of the game's world forever if you didn't plan ahead with a Mark/Recall spell or collect another artifact that's scripted to teleport you to Vvardenfell).
It's Popular, Now It Sucks: Prior to Oblivion coming out, it was Morrowind that was considered to be "the symbol of all the bad trends in the industry" by the Vocal Minority of "hardcore" fans. And mostly for the alleged reason of "dumbing down" for console players. Ironically since then, it is now considered the last good Elder Scrolls game by mostly the same crowd.
It Was His Sled: Is there anyone who doesn't know that the player is the reincarnation of Nerevar these days?
The Ordinators are watching you, scum, and will remind you of the fact whenever you're within hearing distance.
When you're escorting the wisewoman... "hey, wait for me. Hey, wait for me. Hey, wait for me. Hey, wait for me. Hey, wait for me. Hey, wait for me! hey, wait for me!" This easily puts her on the same level as the guards shouting "HALT! HALT! HALT! HALT! HALT! HALT!" in Daggerfall...
YOU N'WAH! FILTHY S'WIT! DIE, FETCHER!
Nostalgia Filter: For most of the current Elder Scrolls fanbase, this was their first game in the series, and as such, it tends to be held up as the gold standard of the entire franchise. Roughly more than half of the criticisms leveled at Oblivion and Skyrim boil down to "it's not like Morrowind."
Padding: If you don't console command your Athletics skill up really high or warp yourself to any town you'll need to go to, you'll spend a lot of time walking. It doesn't help that the default walking speed without very high athletics is slower than an arthritic senior with a walker.
Rooting for the Empire: Some fans see Dagoth Ur as a misunderstood good guy who just wants to free his people from the exploitative foreign Empire. It helps that a huge chunk of his backstory is about how he was betrayed by his supposedly-good best friend.
Mind you, this was after Dagoth decided he wanted to use the artifacts of doom he and Nerevar initially set out to the destroy for personal power.
Alternate Character Interpretation has a big part in this. To some people, the Tribunal murdered Nerevar, and in a later work Vivec sort-of confessed to the crime, while Dagoth Ur was actually just trying to help.
Rooting for Almalexia is a whole another case, rarer but still happens.
Spell reflection if you're a magic-oriented character. Many enemies in the game will randomly throw your powerful destruction spell right back at you - which, considering the likely power of your spells combined with your own squishiness, is more than likely to kill you outright. Gets absolutely ridiculous, to the point of being unplayable, in the expansions.
The Imperial Legion's fixation on uniforms also counts. When you first join you're given an Imperial Chain Cuirass as your uniform that you HAVE to wear if you want to talk to anyone in the Legion. As you advance through the ranks, you'll be given additional armor pieces and increasingly better cuirasses up to the mighty Lord's Mail, which is one of the best armor pieces in the game. Until then though, you're forced to carry around least one Imperial-type cuirass with you (as you'll most likely find much better armor rather quickly) and if you make the mistake of talking to anyone in the Legion without wearing it, you'll be curtly informed that you're out of uniform (which will cut off further communication) and suffer a small disposition loss with that person. Note that this will even extend to any fellow soldiers you're sent to rescue, who apparently care more about the Legion's dress policies than they do about being saved from murderous Daedra worshippers or bandits. The Legion is also the only faction in the game that has this mechanic, making it seem even more out of place.
The diceroll-oriented combat system of the game can be very frustrating to some gamers, especially to those whom were introduced to the series by the later installments, Oblivion and Skyrim.
Having to wait several days between quests for the East Empire Company in Bloodmoon. While it makes sense in-universe in that construction on the colony is ongoing between assignments becoming available (and those assignments are usually you removing issues that were holding up construction,) it unfortunately allows all of Solstheim's vicious and plentiful wildlife to respawn during that time. The lack of fast travel across much of the island means you'll be battling the same packs of wolves and hordes of Riekling Raiders every time you cross the same track of wilderness. While not overly challenging to a high-level character, they do wear out your equipment and greatly slow your traveling speed.
Seinfeld Is Unfunny: By modern standards, it's hard to believe that Morrowind, with its obtuse quests, cumbersome map, lack of NPC AI, and Nintendo 64-era graphics, was cutting-edge at its time.
Squick: The silt strider is a gigantic arthropod used as a means of public transport throughout Vvardenfell. A bit odd so far, but not too out of place for the setting. However, in order to allow for passengers, cargo, and of course the driver, parts of the creature's shell are hollowed out. The driver then controls the strider by DIRECTLY MANIPULATING THE CREATURE'S INTERNAL ORGANS.
Everything dear old Uncle Crassis says, sweetie.
The condition that people born under the sign of The Atronach suffer from that makes it impossible to regenerate Magicka is called... Wombburn.
One of the practice that the corpus inflicted House Dagon members like to do is cut off pieces of their mutated skin and eat it.
That One Attack: Greater Bonewalkers have an infuriating "damage attribute" spell. Note that says "damage" and not "drain." "Drained" attributes will go back to normal once the spell wears off. "Damaged" attributes will stick with you until you heal them with a temple blessing or potion. It's incredibly frustrating to encounter a greater bonewalker halfway through a difficult dungeon only to have him damage your strength attribute so much that you are forced to dump half your inventory (strength determines how much you can carry) in order to flee back to civilization to heal.
That One Boss: Gaenor. He reflects almost all damage from magic spells and mundane weapons due to having an insanely high leveled Luck. And no, there is not a puzzle to get around it. You just have to have a hell of a lot of Hit Points while you pummel this heavily-armored highly-agile guy until he falls over and dies. He starts as an NPC, but if you speak to him for any reason, he'll eventually come back in armor. Fortunately, he's still easy to avoid. Like most of the annoying parts of Morrowind, he appears in Tribunal.
This is a case of When All You Have Is a Hammer. It's actually relatively easy to beat him by using a weapon with a Damage Attribute enchantment that wipes out his strength or luck (remember, Damage Attribute is the one that's permanent without a blessing from a shrine). However the most often used course (levitating out of range and blitzing him with a ranged weapon or spell) is unavailable due to Tribunal's ban on levitation.
Gedna Relvel, from the Tribunal expansion. She's a very powerful lich that regenerates health and magicka, and is capable of casting a very powerful spell with a very wide area of effect. Due to a bug giving her obscene amounts of health, she can end up being unkillable. Thank Azura she's only encountered in a sidequest...
Another is acquiring Eltonbrand. First, it requires you to acquire Goldbrand as part of an obscure quest that you are extremely unlikely to find on your own. (The one person in the game who tells you about it isn't exactly trustworthy and even then, his directions are bad, leading you to swimming around in the ocean further south than you need to.) Then, you get directions from Boethiah to find him/her (it's complicated) a sculptor to rebuild his/her shrine. If you manage to do that, then wait the two in-game weeks required for the statue to be built, you can finally claim Goldbrand. To upgrade it into Eltonbrand, you need to become a vampire (something most players of the game may not even realize is in the game for many, many hours) and perform a specific quest with a specific amount of gold in your inventory. THEN you get Eltonbrand. Complicated and near impossible to find on your own, but very worth it.
Gaenor doesn't really have any fans, mainly because he'll end up hating you no matter how you deal with him, and because he'll later return with good gear and and a high luck stat, making him extremely difficult to beat using regular combat methods.
Ugly Cute: Scribs, which are baby kwama. They look like a mix between a pillbug and a chestburster from Alien, but they're still positively adorable. The fact that they're the most passive animals in the whole game, that they're no bigger than a Pomeranian, and they make the most innocent-sounding squeals when idle just makes you want to have one for a pet. And Bethesda must have been aware of this, since the Tribunal expansion actually lets you buy one while you're in Mournhold (even if you can't take it with you back to Vvardenfell), and they can also be purchased in The Elder Scrolls Online.
Uncanny Valley: In audio form. In various Sixth House enclaves, shrines, and lairs there's a set of bells that the player can ring. There's only half a note difference -instead of the intuitive whole note- so something sounds wrong and unsettling about the noise they produce.
Argonians and Khajiits walk like they broke their ankles. Everyone else walks like they have a stick up their ass (a pretty blazin' stick, though). Their jaws flap in a really weird way when they talk...
The Bull Netch can be this, once you realize they have faces!