I usually bump my luck down to about 30 when I make a new character so I can raise my speed and agility up. I was wondering if that's really a wise decision. I'm not sure what luck really does, but since it's not tied into any other skills I figured that it must be at least somewhat important as a standalone statistic. Does anyone know how important it really is, what effects it causes, and whether I should keep it higher?

The major effect that luck has on game-play is on what you find in treasure piles. With a higher luck, you will find the stronger metals in greater abundance sooner. With the wealth levels in Daggerfall being as high as they are, you can probably live with the lower luck.

By the time you'll truly need Daedric equipment, you'll be tripping over it. This applies to those even with low luck.

So luck doesn't really have any effect other than on what kind of treasure you find?

No, Luck affects everything you do in a small way. Consider every action you do that needs a skill check or a saving throw and if your character has sufficient luck you get a small bonus to succeed. I think that to see any noticable difference in the game though you need a really high Luck. Try to boost it to 100 as early as possible and see the results. Don't expect anything groundbreaking but you should be able to see the difference.

I said the major effect was about treasure. Otherwise it is as raf256 states.

Oh, I see. Thanks for the replies, I had been wondering about that for a while. I'm wondering now if I should keep my luck up and just make do with a little less speed and agility, do you think it's worth it, or that having those attributes higher is a better investment?

I would just not nerf the luck too badly. Leaving it at default level should be fine.

Yeah, I would pretty much leave it as-is. Things you'd think are luck affected (pickpocketing) are technically mostly tied in with Agility. I've never seen a major boost in the quality of items. The best I've found in a store was Mithril, with neutral Luck. Go figure. :shrug:

Best items probably are from dungeons, at least in my case. Too bad I'm not a dungeon person.