sometimes I want to mute the game and listen to music but even when I go to the menu and turn off all the sounds it still makes a ton of noise. I'm playing it on dosbox, what is going on here?

I have the same problem and I don't know what to do, but usually, the music covers up the sound from Daggerfall. The only thing I know of that may help is to turn the music volume as high as possible but keep the computer volume as low as it can be while still allowing me to hear the music loudly enough.

Either (1) Go into Daggerfall setup and set your soundcard to none.
Or (2) Go into your DOSbox config and disable sound emulation.

I don't know if you have tried this or not but put both audio settings except music at least, the sounds are still there, but less intrusive upon the music.