Yeah, I totally support the OP. I pretty much bought the Collector's Edition of Morrowind just so I could have an official physical release of the album.
I understand they're trying to make it wide spread with MP3 downloading, but the files are only marginally better than what is included for free ingame. I would rather the incentive of buying the soundtrack out of the game and receiving official artwork, track listing, and composer's notes.
I wish they'd use real instruments too?
ETA: Besides, lots of other companies and games enjoy entire sets and releases of their OSTs. Seeing as the Elder Scrolls series has enormous popularity with its score, I think they'd actually make a little on this.