Umm... You are playing Morrowind, right? I have one of these myself. Quite literally NEVER misses at around 70-80 weapon skill. (Which you should have at around level 5)
You've said this many times throughout this thread, and I don't believe you are trying to exaggerate, but you most certainly are. Obviously misses will be much more rare at 80 than 40, but they do not NEVER happen. And getting to level 5 with a 75 in a weapon skill would mean at least 30 increases in a weapon skill, with 20 in your 9 other skills, most of which are passive, and level up without you necessarily trying to level them up. And I disagree that other people are exaggerating how much they miss, I think that is quite accurate. But it is really the same as Oblivion, it is just more frustrating to people.
In Oblivion, you'll click the mouse button 10 times, you'll hit an opponent 10 times, before they die. In Morrowind, you'll click the mouse button 10 times, and hit the opponent twice, before they die. It's really the same, but overall I prefer Morrowind's system because it has more potential. Morrowind's problem with its system was mostly cosmetic, while Oblivion's system had reached its fullest potential and we saw how it ended up.
So I say keep blocking up to the player, like Oblivion, but go back to Morrowind system. When you 'miss', simply have you opponent dodge out of the way, or block, or parry. And have several different animations for each. I don't want to see my opponent doing the same movement to dodge every one of my swings. Realistically, I would learn and anticipate what he was going to do and kill him. Have the dodge or block happen depending on your opponents block skill or agility, against your weapon skill and speed (or agility).
As it is, the system doesn't account for locational damage. To account for this, it could be made so that if you are aiming for your opponent's head, you are more likely to 'miss' than if you were aiming at the torso or limbs.