Games are not about challenge, necessarily. TES is certainly not about challenge. Nor is any other RPG (hey part of "role playing game" is "role playing" not "challenge").
Bethesda has always allowed players to choose. Or so they think (they don't allow choice of character aesthetics, so they really need to fix that problem). Basically, there is no way that an open world developer can consider the infinite possible perceptions of their players. They have to leave it up to the players as much as possible (again, Beth, fix the lack of choice of character aesthetics to improve your games!) This is particularly true on PCs with mods. That's totally up for for grabs.
As for offering more content, there is no need for unique items and such, or not as is mentioned here. All that is needed is more collectibles. Players want their characters to collect stuff. This could be almost anything, but popular items are things like outfits, weapons, books, spells, and yes, even unique/artifact items. Heck, just collecting ingredients for alchemy or crafting is something a character would do if they are in one of several archetype personalities. For long term play, collection is king.
Example: in Morrowind, many people tried to collect one of every single type and variation of soul in soul gems. What did Bethesda do starting in Oblivion? They took out the naming of captured souls so that this is no longer a possible play style for anyone.

Yes, they actually went backwards as far as adding potential play possibilities.