Regarding the 'walled cities'; I'm not sure if I heard it correctly (being 4am over here) but I noticed Todd's remark of cities that load as you enter them as opposed to clicking on a door.
This leads me to assume that -maybe- the cities will have walls, but not transition gates that just load you into a seperate cell. So rather the game loads the area around you as you move into the city as opposed to clicking on the big gates.
But then again I may have misinterpreted Todd's explanation or just heard it wrong.
At any rate, it's nice to hear that the different Holds may have alternating/differing views and opinions in the style that was presented in Morrowind with the Great Houses. To me this could provide the player with a world that feels more real and alive because not every Nord is the same cookie-cutter Nord. Also the 'racism' regarding certain races sound interesting as playing with all the races in Oblivion did not give me a sense of 'Hey, I'm a Bosmer and people respond to me differently than when I was playing a Nord.'
Also the bits regarding giants having their own style of living breathes atmosphere to me and Skyrim not being a place where every critter is just placed in an area with the sole intention to kill you on sight.
So I hope this next Elder Scrolls will provide us with the depth and atmosphere of a world that has existed since the dawn of Men. :tes: