It is definitely dated and I know I'm showing my age here. I believe I actually played both Arena and Daggerfall pre-Win31 in DOS. However, the core gameplay in Daggerfall was amazing. This was the first RPG where I could walk into a shop, hide in the attic, wait for nightfall and then rob the place blind!
There was procedural generation of maps in Daggerfall for sure but I don't necessarily see that as a bad thing. The game was truly immense for its time and it was a real game changer for video game RPGs in my personal opinion.
Give it a shot if you like Morrowind. If you can deal with the retro graphics I think you'll really enjoy the play through.