I went through every step in the process on this link here, because the link that comes in the Readme install guide doesn't work:

http://www.brighthub.com/video-games/pc/articles/118565.aspx

I try to run Morrowind, but the following message appears:

"Error: MGE is not configured. Please run MGEgui to configure it before launching Morrowind."

So I try to run the program, but the moment I click it, it stops working. Before it even opens up!

I'm running a Windows 7 Dell Inspiron Laptop.

You have to launch the Launcher_Morrowind.exe and to set a resolution in the options.
and after run MGE.

That is an old version of the installation guide and leads me to believe you may have an older version of Morrowind Overhaul.

Please read http://www.gamesas.com/topic/1319942-relz-morrowind-overhaul-sounds-graphics-20/ and follow the instructions given there. If you are still having problems please post them to that thread.

MGE still fails instantly after setting the res.