(UPDATE August 2010): By this point in time, it's probably no longer a question of whether to patch or not, but one of which patch and in what installation order. I've used the following installation sequence with good results:
If you are not installing "Bloodmoon", there is a 1.4.1313 patch that applies only to Tribunal (downloadable from Bethesda Softworks), but I don't think you can currently get Morrowind without both expansions, so it might be a moot point for anyone who didn't purchase the game when it came out. Could be wrong about that, though.
Fixed conflicts between the werewolf quest line and the werewolf cure quest.
Turning into a vampire and werewolf at the same time using Hircine's Ring or by catching lycanthropy during main quest and then fighting a vampire is not possible now.
Fixed issue where Blindness spell no longer worked correctly.
Guards at Fort Frostmoth now remember if you've given them booze.
If your companion dies inadvertently during the smugglers quest, the remaining quest giver will now speak with you so that you can get next quest.
The occasional crash caused by casting Recall, Divine Intervention, or Almsivi Intervention has been fixed.
Fixed art issues with Snow bear boots and the right snow wolf gauntlet.
Wolf, Bear, Ice and Nordic Mail armor all have correct weights now.
Hammock that didn't let you sleep in Raven Rock, Factor's Estate was removed.
Art using the SignRotate and Float script now works properly.
The female Bear and Wolf armor now appear properly.
The Stahlrim War Axe now ignores normal weapon resistances.
Made the hidden Daedric Right Pauldron slightly less hidden.
Dandras Vules' dialogue no longer loops.
The dwarven satchel charges explode correctly.
The bridge in Sotha Sil, Dome of Udok will now animate correctly.
Error with returning Eleidon's Ward to the museum is fixed.
Fixed Summon Fabricant spell issues. It can be cast correctly now with Bloodmoon loaded.
Urvel Dulni will stop following you when you tell him to.
Three Morag Tong Grandmaster quests could not be obtained from the questgiver because of incorrect condition checks. Now all four Grandmaster writs can be issued and executed.
Fixes an exceptional case where the vote counting global script does not start during a House Redoran quest, preventing the questgiver from recognizing quest completion and blocking advancement
Corrected a dialog where the string in the topic 'Progress of Truth' should have been 'watched by Ordinators' -- NOT 'watched by THE Ordinators'. This fails to set the topic 'watched by Ordinators', which gives the player the code word 'amaya'.
Fixed an exceptional case where the player is not advanced to Archmage after killing Archmage Trebonius.
Fixed a fault where Dren would not advance the PC to Councilman Rank; he would always skip a rank and make the PC Grandmaster.
Repaired a missing hyperlink in Tul's dialog that prevented him from following the PC, and blocking quest progress.
Fixed a fault which prevented Volrina Quarra from placing a journal which signaled the end of her quest.
Imperial Altars and Temple Shrines now restore damaged skills as well as attributes. [PCs with skills reduced by the 'Fury' weapon can visit Imperial Altars and Temple Shrines to restore their damaged skills.]
Bug Fixes
Running and jumping through a teleport door no longer damages player when they land on the other side.
Fixed a bug involving a crash when mousing over your Faction while in menu mode.
The weapon "Fury" now has a "Drain Skill" effect instead of a "Damage Skill" effect.
Imperial Altars and Temple Shrines now restore damaged skills as well as attributes. [PCs with skills reduced by the 'Fury' weapon can visit Imperial Altars and Temple Shrines to restore their damaged skills.]
The Bound Cuirass can no longer be dropped.
Fixed a bug involving a container disappearing if you had its contents menu open and then loaded a save game that would place you in the same room as the container.
Objects dropped, while you are swimming with no objects beneath you, will no longer disappear to the center of the world.
Stacks of repair objects will now show their quantity when moused over in the world.
You will no longer be able to right click out of the Silt Strider travel menu. This was causing a bug that left the travel menu open after all other menus had been closed.
Fixed a bug that would allow you to place and remove alchemy objects multiple times in the alchemy menu and create copies of this object in your inventory.
Fixed a bug that was deleting alchemy objects if you had a container open at the same time you had the alchemy menu open. If both menus contained the same object, the object was being removed from the world. Opening an alchemy menu will now close any open container menus.
Fixed a crash bug involving the creation of new leveled creatures in a plug-in. If you saved your game with a new leveled creature in view from a custom plug-in, then chose to load your save without the plug-in, you would crash. Now if you load this save game you will no longer crash.
Fixed a bug involving mouse buttons not responding in menu mode.
Fixed the resurrect function to no longer resurrect disabled NPC's or creatures.
Fixed a small memory leak when summoning bound items.
Items stuck on your mouse pointer will no longer disappear if you click on a spell or magic item in the magic menu.
6th House Amulets no longer drain your fatigue.
NPCs now correctly report the presence of publicans and beds for rent in Seyda Neen, Suran, and Dagon Fel.
Fixed an art file problem with the Redas War Axe.
Script sealedtreasuryreport revised to permit scroll to be closed or picked up from the world if the seal has been broken.
Saved games now know which language they are and the Save and Load menus will not display saves that do not match the current language.
Fixed a crash bug that occurred when you selected a scroll as active magic then moused over the image of the scroll in the active magic slot on the multi menu.
Ingredients in Alchemy menu are sorted alphabetically by name, not ID.
Objects in inventory and containers are now sorted alphabetically.
Quest FixesFixed a bug dealing with the killing of Bolvyn Venim. Now if he is slain [except in a proper duel], an 'Essential NPC Killed' message warns the player he has broken the main quest.
Fixed a bug dealing with entering Sul-Matuul's yurt without permission before beginning his part of the main quest. This made him hostile, preventing advancement in the main quest. Now when Zabamund first tells the PC to speak to Sul-Matuul, a hostile Sul-Matuul is reset to not be hostile.
Fixed a bug in script VivecArenaScript for NPCs transported to fight duels in the Arena which occasionally caused the NPC to appear below the Arena, breaking the duels and quests. Also added a check and fix to restore NPCs in saved games where dueling NPCs had fallen through the Arena floor and disappeared.
Fixed a bug concerning the killing of important NPC's and creatures to the building of your stronghold in House Hlaalu. You should now receive a message saying you can no longer continue with your stronghold if you kill someone important to this quest line.
Completing the "Ice Blade of the Monarch" out of sequence for the Imperial Cult as a freeform activity no longer causes the player to lose the earlier 'Ring in Darkness' and "Boots of the Apostle' quests in the faction sequence.
Improved directions to the cavern of Milk in dialog and journal for the Mad Lord of Milk quest.
Fixed a bug when Dram Bero's champion is slain, but not slain in an Arena duel, Dram Bero's greeting falsely implied that Dram Bero now had given his support for the PC on Hlaalu council. Now the greeting accurately indicates Dram Bero's anger, and other dialog topics indicate that Dram Bero will not support the PC for House Hlaalu council.
Residents of Sadrith Mora will now acknowledge when the PC has ended the Gateway hauntings.
Added condition 'Journal a2_3_corpruscure 50' to 'Dwemer piece' topic. Prevents giving misc_dwrv_artifact50 before quest has begun, preventing Caius from skipping quests.
Fixed a bug in Vedam Dren's dialogue options that was checking a journal without checking the player's faction. It allowed the non-Hlaalu player to be raised in rank in House Hlaalu by killing Orvis Dren, making the player a member of two of the Great Houses.
Fixed a bug in a Morag Tong quest that was causing Darys Adram to give quest dialogue to players not currently completing the quest.
Fixed a bug that allowed the VA_VampAmulet quest in the Quarra Vampire questline to be restarted after completion.
Added a condition to the Morag Tong greeting the player receives from faction members upon becoming Grandmaster. Because a Main Quest character was in the faction, she was not using her appropriate Main Quest greetings, stopping the Main Quest.
Additions
An auto run feature has been added. You can now continue to run forward when you press the Q key on your keyboard once. This will cause you to run forward until you press the autorun key a second time or the back or forward movement keys.
A version number has been added to main menu screen.
A health Bar for NPCs and creatures has been added for when you are in combat. An orange health bar for the creature or NPC you are currently in combat with will now appear above your own health bar on the lower left part of the screen. This health bar will only appear when you are attacking a creature or NPC and will slowly fade out if you stop attacking. It will also update to a different creature or NPC's health if you switch targets in the middle of combat.
Added Difficulty slider to Preference menu under Options. The Difficulty slider has 200 different settings that will either increase the amount of damage you deal and receive or reduce the amount of damage you deal or receive, depending on where you set the slider.
The user can now load multiple plug-ins without losing references when both plug-ins affect the same cell. This means that if you have 2 or more plug-ins that add or remove references from, for example, Fort Moonmoth, you will be able to keep all of the additions or removals from all the loaded plug-ins.
Added a "DirectX Diagnostic" button in the Morrowind Launcher that allows you to run the DirectX Diagnostic tool directly from our interface. This can be reached in the Morrowind launcher. Click on Technical Support in the launcher and you will see a DirectX Diagnostic button that will run this handy tool. The DirectX Diagnostic tool is very helpful for problem shooting any technical problems you may be having with the game.
Added a sound quality button to the Options menu. The two available choices are Hardware Acceleration and Software Mode. Those of you that are still experiencing sound problems should set this Software Mode.
Bug Fixes
Fixed several sound problems with several lower quality sound cards. You should be able to play the game with your Hardware Acceleration set at full from now on.
Fixed a bug that was causing problems when you attempted
to save with a container open.
Only guards marked as re-spawn will re-spawn now.
Plug-ins will no longer come up with a warning in the launcher saying that that plugin/save uses a different version of master file than is present when they do not.
Jumping up slopes will no longer cause you to float and glide.
Summoned bound items no longer give you infinite stats.
You will no longer crash to desktop if you press Enter while making potions.
You can no longer drop conjured weapons if they un-equip then equip them.
Health numbers for weapons in the quick keys menu pop up help will now display accurately.
Loading while the container menu is open will no longer create multiple cloned containers.
Fixed some menu bugs with saving a game by only allowing saves to occur if you have no other menus open.
Memory leak when summoning bound items has been fixed.
Fixed a crash when canceling barter.
Fixed a freeze that locked the game in a bad menu mode after Sleeper dreams.
Training skills will now add to level up bonus for misc skills.
Armor weight will no longer shift between Heavy, Medium, or Light.
Restore and Drain abilities now affect the current value, not the base value, of attributes being modified.
Inventory change of pc during an attack no longer causes bad animations.
The frost atronach will now attack faster than before.
ALT, SHIFT, and CTRL keys were rarely getting stuck down in menu mode. This will no longer happen.
Fixed a bug where you could gain money when buying something instead of paying money for it.
The launcher will not gray out options any longer.
Robe of St. Roris changed to Cast When Used.
Equipping a soul gem/apparatus, etc, during combat will no longer remove them from your inventory.
Fixed a crash when hitting F1 with the quick keys selection menus open.
Fixed a problem with sounds persisting after a cell change.
Fixed a bug in the Berserk ability that was draining all of your fatigue after its use.
Fixed a bug with beast races and the spell cycle function. Now when a beast race has an item they cannot wear (full helm, boots), it will not show up in this menu.
Fixed a bug in the weapon cycle function that was allowing constant effect weapons to add bonuses to you permanently.
Corrected a bug which would cause an NPC to sometimes run inexplicably while wandering.
NPCs/Creatures which bump into an obstacle while wandering without the presence of a pathgrid will select a new point to go to rather than trying to work around the obstruction.
Corrected a bug where the vertical movement distance was not calculated for followers and they could lag behind excessively.
NPCs will no longer attempt to open trapped doors to reach you.
Fixed a bug where you could kill an NPC responding to a crime, with a single blow, and not receive a bounty for murder.
Fixed a bug where you, as a vampire with a high bounty, could commit additional crimes, and guards would fail to respond.
Corrected a bug where an NPC would fail to respond if you were in a crouch and hit them with a projectile weapon.
Fixed a bug concerning trying to equip multiple repair items during combat would cause a crash.
Fixed a bug with the way dispel worked in conjunction with good and bad effects on you.
Fixed a crash bug involving shooting a projectile at an actor that was far enough away that they were not active.
Fixed a missing art file with the Redas War Axe.
Quest Fixes
Fixed a bug that prevented you from speaking to the Daedric Statue of Boethiah if you had spoken to M’Aiq the Liar about (Shrine of Boethiah).
Fixed a bug where you were falsely being recognized as Hortator of all houses.
If you kill Marcel Maurard, you no longer can get a reward from Miun-Gei over and over.
Fixed a House Telvanni quest that was not allowing you to complete Master Aryon’s quest involving the collection of wizard spells.
Fixed a bug with Dwemer Puzzle box and Hasphat not giving you a key.
Bug in the CloudCleaver quest where you could take cloudcleaver from the witch before she dies (thus breaking the quest) has been fixed.
Fixed an infinite dialogue loop in Wine-Sot/Cloudcleaver quest.
You can no longer receive unlimited gold for solving the murder of Ralen Hlallo.
Fixed an infinite dialogue loop in (law in Morrowind) topic.
A confirmation box was added to the Magister topic in the Telvanni house quest line to ensure that you do not wish to continue any further in this line.