It's aged as well as nostalgia has.
I loved lots of qualities of Morrowind, but it's the least played out of that, Oblivion, and Skyrim, for me.
I always found the menu UI clunky, though I played it on Xbox, so that was probably partly why. And the combat system absolutely svcked compared to how they got it right in Oblivion with actually making it so that you controlled your ability to hit and block, instead of leaving it to a weighted dice roll.
But the thing I have to acknowledge is that Morrowind was my first true entry into the Elder Scrolls series, and you never really can quite go back home, so to speak. It's partly why I love how they included some of the music, especially that one piece that would always swell up in volume at the right moments to make even the mundane moments in Morrowind seem strangely epic.
I'd happily play an updated version of it, but it's otherwise its own chapter for me, much like Oblivion is, and much like Skyrim will be. Each game, I've found my own faults and loves for each, and I really don't try to compare one to the other, because each one is different enough that it's never a straight comparison.
But one thing I will say is that Skyrim feels very much like a cousin to both Morrowind and Oblivion, in various ways, and is a lot like Morrowind in more ways than some players with nostalgia lenses would probably admit.
They even brought back Temple quests, to a degree.