I think that either east or west are likely if they stick to having real expansions in addition to smaller plug-ins or DLC. West would be new, while east would give a chance to show a new part of Morrowind, and at the same time answer everyones questions about what it looks like now (70% chance East, 30% chance West is my guess). The big question is why would we go there? What problem or situation would make it a destination?
Actually there is another big question. Will they do large expansions or a set of 3 or 4 mini expanisons (no bigger than Knighs of the Nine)? Mini expansions might unfortunately be seen to work better on the consoles (and there is a comment I think I remember about not wanting to do something the size of Shivering Isles as DLC again). If they go this way we can pretty much wipe out any hope of a new territory of any reasonable size.
Actually there is another big question. Will they do large expansions or a set of 3 or 4 mini expanisons (no bigger than Knighs of the Nine)? Mini expansions might unfortunately be seen to work better on the consoles (and there is a comment I think I remember about not wanting to do something the size of Shivering Isles as DLC again). If they go this way we can pretty much wipe out any hope of a new territory of any reasonable size.
To answer your first, it would depend on the context of the game as to why we would go there. But they could really come up with any reason. I mean, why did you go to Solstheim or the Shivering Isles? Because they were there I suppose. Only Shivering Isles was remotely related to Oblivion's storyline.
As for your second thing, I think 2 is a magic number. They could do however many they want, but they have their own work schedule. While the game is about to be marketed, work on DLC. After you start releasing DLC, work on a first expansion. And right after you finish that, Start progress on a second while you think about the next game in the series. Basically, just consider time they have to devote to DLC and the continuation of the series.
Consoles are not a limitation when it comes to expansion size though. There are many games on consoles with huge expansions like that. Smaller things are just easier to churn out, and console gamers will buy them because official DLC is the only thing they have to spice up their games.