One option can be a little bit of borrowing of a system that IMHO is the best of both worlds, and something in between the Morrowind method and oblivion method, i.e:
Two World's method, or their equivalent in TES series, The Ayleid Steps.
When playing Two Worlds, you may find several monuments scattered throughout the world's area, and each one that you find becomes active, when you enter an active monument, a map of the world opens and you can select another monument's icon for the destination and jump to that place, nice and easy, and immersive as well.
You have an Oblivion style fast travel, but you have fixed source and destination points, more accessible than Morrowind's method, because there are a lot of the monuments scattered throughout the land, some inside or near the towns and others on far-off lands.
And you have the oblivion's freedom to select the destination from the map, but you have to find the monuments to make them active before you can select them as destination, and you have to be inside one to be able to jump to another, and it is quite immersive and does not eliminate the need to travel on foot and random encounters.
IMHO this is the best method, and you can add Morrowind's method to this, for more immersion and more options.
And instead of the Two World's monuments, we can have Ayleid's steps, just like the mod of the same name in Oblivion, so if that is incorporated into the game engine and let us select the destination target from a map, then it would be perfect, and after a while when we reach some specific stages of the quest regarding those steps, we can have additional features, like random destinations to some deep dungeons and the like.
The quest regarding those steps can be started near the beginning of the games, and can be part of the main quest, or a misc one, and can be developed into a full fledged treasure hunting quest, or something like that.
If someone ignores the quest, (s)he would not be able to use those steps effectively, and would have problems with them, and would have to fall back to the Morrowind's style, until (s)he decides to attend the quest regarding those steps.
Another method can be like oblivion but with more options, so you can find rides, boats, carts and the like, and use them, a bit harder to use but quite immersive and opens opportunities for new quests.
What do you think? :deal: