I was introduced to the series with Morrowind, and went back to play through a good portion (all main quest and anything with tangible structure) of Daggerfall. Arena I could never get running right, but since Daggerfall is really just Arena II, it's probably not worth playing now anyway.
So to answer the question, Lore is
incredibly important. As a fledgling writer I definitely appreciate the sense of continuity and cohesiveness that the writing in Morrowind had. (Some obvious failings notwithstanding). The lore of the game is the real thread, while the games themselves are individual and vastly different vessels in which you experience the lore. Oblivion unfortnately didn't cash in on the rich lore, and suffered greatly for it. I've always attributed this out of time constraints when working with the new generational hardware of the Xbox360. Maybe that's being hopeful.
That said, I understand that these are
games and a writer has to be careful not to "Write themselves" into a corner. The point at which Lore no longer services the game, is the point when lore no longer matters. Things like a City's location or the spells within a certain school of magic are just examples of "Overwriting", backing the developer into a corner by making it impossible to reclassify "Turn Undead" as a Restoration skill, or move Markarth Side to the border region of Hammerfell
can (not saying they did) make for a frustrating process of either addendum or poor balance which harms both the developer and the player.
Writing in games also has another obstacle. Literature is a "bottom up" form of interpretation. You read the description of Grendel or Cuthulu and you work up what it looks like, when you see a creature or location in a game, you work from the "Top down", seeing the result but then asking "Why" or "How", in which it's harder to "Hide the cracks" so to speak. An easy, but not so anologous example of this would be Bandits hiding in a tomb, superficially, a stupid choice but laying subtle details like placing the Tomb along a road into town, or maybe a natural cavern system with a grotto gives more data to interpret. This kind of world-writing will come into play when we get into the Dwemer ruins within Skyrim, having to ask ourselves why an often avowed enemy of the Nords has Strongholds within the current borders of the Province.
Love TES games, but I find the lore (for the most part) somewhat uninspiring.
If you're not going to at least explain how, or give an example, you really shouldn't bother using such pseudo-intellectual terms as "uninspire-ed-ing". To be fair though, having true originality in the post Tolkien/Gygax world is incredibly hard, much harder if you're trying to maintain some illusion of believability. Grounding the game's lore in a typical "Elves and Men" while writing up their own creation stories and political systems is about the best anyone could have been expected to do given the goals. If I remember my Elder Scrolls history correctly, the lore actually sprang up from the early Arena Teams D&D sessions.