https://steamcommunity.com/linkfilter/?url=http://imgur.com/zjgXIBQ
This is not my image, but I'm having the same issue in that whether or not I'm fullscreen I get an annoying window border around Morrowind.
I had been using MGSO (Morrowind Sound & Graphics Overhaul) which includes MGE (Morrowind Graphics Extender) which is most likely the source of the problem- but the problem persisted even after I uninstalled, deleted the files in the Morrowind folder without applying mods and reinstalled!
Google is absolutely worthless for finding a solution to a problem with this many frequently-use words.
Activating Window or Fullscreen in launcher options does nothing. Changing to-or-from Windowed Mode in MGE options isn't fixing it either.
I have no idea what to do to fix this. Please advise.