Guards with Morrowind Guard armor sounds cool, but would renaming vanilla armors play nicely with other mods changing them, for example giving them OMOBS stats etc.? Not sure, but it seems it might cause issues. Well, perhaps it can be sorted out with the Bashed Patch in that case.
Yup, something can always be patched one way or the other, be it by a Bashed Patch or a handcrafted patch. I just don't think anything should hold a modder back on doing things the way he wants to.

EDIT:
Also, would you really call Cyrodiilic Steel Armors that in Cyrodiil? It's a bit like if Swedes would call meatballs "Swedish meatballs".
Hehe, at IKEA they are called Swedish Meatballs here indeed. But I guess that's different in Sweden! Anyway when using mods like Tamriel Heightmaps using the term Cyrodiilic Armor doesn't seem out of place.