To really sink your teeth into this game, you should not install any big mods, so that you can experience the original game... and then later add mods when you realize what you want to change/add.
But, it's your game.
http://www.gamesas.com/index.php?/topic/1060141-mod-recommendations-for-new-players/page__hl__recommendations - links to all the tools/patches you'll need. Info on where to find mods, and links to other players suggested mod lists.
MGE is great. Even if your computer cannot handle Distant Land, it still has other neat options and comes with the MW Script Enhancer that some mods require.
Morrowind 2011 is not allowed to be discussed here. End of discussion.
The http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=8987 is an easy to use set-up that will update many visual aspects of the game for you. Many people prefer installing mods on their own, but this package is good if you don't want hunt them all down and make your choices.
http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=8707 is a great survival mod.