So the problems are, with editing the skeleton IIRC...
1). "may be impossible though to me, due to the way Morrowind mixes different animations together", I am afraid you are right: we know nothing about that. It obviously does something (head rotations, animations with a torch, odd problems with PlayGroup/LoopGroup). However, I have tried to add extra finger bones to lower and upper body parts (neck and pelvis without obvious problems). I think it is worthwhile to ask MW code patch developers when they will be back to check that.
2). I have no idea and have to check some stuff.
3) I am not sure that amount of work is justified. People are very conservative and scared of any global initiatives (see debates about BB alternative body meshes). I, myself, prefer local (NPC level) modifications.
4) Probably. TESCS (hight/weight) might work with the scene root.
5) I have made only few animations with scale bones, there were no problems. However, these bones have influence within a NiTriShape. I guess seamless bodies will not work with MW clothes/armor slots/replacement system.
6) Yes, that's aPitA and the NifTools Max project is actually, unfortunately, dead.
Solutions as far as I can tell will require
1). We have to wait for a long time厖?br />
2) "How do Oblivion animators use twist bones?" I have no idea. I tried to ask them once: they were to proud to give any answer, the have just ignored me. I am very curious how Blender deals with twist bones.
To be short: my vision ?MW skeleton proportions revision is a very interesting idea, but we do not have sufficient information, skills, time, manpower, and no community request/support to start a massive frontal "attack". But, I will continue low profile "experiments" on this issue.