Like you say both Oblivion and Skyrim are technical improvements over Morrowind. I also like fully voiced acted NPC as well these days so all of these are positive. I don't have any issues in this regards.
My main issues, mostly with Oblivion and to some extent with Skyrim too but lot less, they felt "life less". The world didn't evoke a sense of wonder. After while, I was not curious whats around that corner. When I go into most, caves, towers, towns etc, I knew what to expect. I spotted the formula very easily. Part of the problem was level scaling and loot progression and another part was dumped down character progression.
I felt that texted based NPC in Morrowind at that time had more "character" and "soul" than the voiced acted NPCs in both Oblivion and Skyrim during their time. By the time Skyrim came out, other games (mostly Bioware) have set the bar high in terms of voice acting and NPC character depth, so things felt bit meh.
Looking back, I think Morrowind was a "messy" game but Oblivion and Skyrim "were well ordered" or by the book games! I guess it was the messiness which made Morrowind great for me!
That's fair enough
Personally, I always found Morrowind very static. I don't remember who it was around the Watch who said it felt like walking around in a painting - but that was a very fitting description for me.
Was it that Remy-something guy? The scandinavian guy with red hair that left years ago.
To me, Oblivion - and especially Skyrim - felt much more alive. Oblivion was the first of them to use Speedtree - which really made the forests come into their own, from my point of view.
Of course, it didn't help that I didn't like the actual terrain and art style of Morrowind. It felt very… brown and grey, to me. I'm much more into lush forests and lakes, that kind of thing.
I also think Oblivion improved the visceral nature of combat quite a lot, and it wasn't enough to just spam the left mouse button anymore.
Of course, being a huge fan of stealth and archery that was also a big thing in favor of Oblivion. I don't think anyone would argue there's much of a comparison between Morrowind and the later games when it comes to those aspects.
Oblivion also implemented physics for the first time, which is a big reason archery felt so much better.
But, on the other hand, I found Oblivion had lost some of the old-school charm and appeal of the older games. I found the interface a huge step back, as well.
So, subjectively - I think Oblivion is significantly better than Morrowind. But, if I try to look at it objectively - I can see why some would prefer Morrowind.
That said, I really do think our young age at the time the first games came out makes a difference in our perception.
But it's the sort of thing you really shouldn't mention - because it can never be proven, and people will never admit it anyway