I don't know how you intend to direct a fireball at an enemy and heal yourself at the same time with the same hands but good luck. I think Self targeted spells should always have to be cast separately from touch or ranged spells. To me, that just makes sense, otherwise you could just spam a spell that protects you 100% from damage for 2 seconds and does damage to your enemy. That just doesn't sound fun. I'm all for a quick change for swapping spells on the fly, maybe even macros (if you can figure them out through a 3rd party program), but being able to keep yourself protected and hurting the bad guys at the same time seems like a no no.
Yes. This can turn into an overpowered cheat really quickly. In the past, it was mitigated by amplifying the cost of multiple spell effects, but we probably won't get spellmaking, anyway.
It might work if Bethesda designed a hot-key chaining system, so that you could fire off a custom sequence, but your character still has to go through the individual animations. That might remove the interruption of the combat flow, without turning into cheat spam.