The enchanting magic items part of the game is actually pretty neat, though you'd have to make it more difficult so that people don't do as lots of people did and turn a set of clothing into armor of 100% sanctuary
Alchemy was far, FAR worse than Enchanting, heh.
Oh it was beautiful. Artful even. The system scales infinitly, you see. And a potions effectivness is based on both your Alchemy skill, and your Intelligence. And you could make Fortify Intelligence potions. Say your Int and Alchemy are both 100. Make 10 FI potions - say each one boosts your int by +10 for 180 seconds. Drink them all. Your int is now 200. Make 10 more FI potions - oh but these ones boost your int by +17 for 312 seconds.
Make some, drink them. Make some, drink them. Make some, drink them. So on and so forth. You'll get to the point where the FI potions you're turning out boost your int by +1500 or more and last for several
hours. Then, once your intelligence is sufficient to shame most gods, go ahead and make some normal, lesser potions. Like levitate. You'll end up with something rediculous like Lev at power 50,000. If you're outdoors, moving even slightly in one direction will rocket you several map squares over, and then crash the game as it tries to load all the areas you went thru simultaneously. Fortify Speed? You will run thru walls. Literally. You will become too fast for collision detection to keep up with. So on and so forth.
Anyway - I love Morrowind to bits. I think it would make a wonderful game setting. I do, however, think that not
every aspect of the game should be translated. Like the aformentioned abusable enchanting and alchemy systems. Other things, like the skill/mana based magic system would be quite doable, but would require a pretty major rework of d20 mechanics to pull off properly, such that the resulting offspring wouldn't really be d20 any more. It would be something else.