I have MGE installed, full version.

I keep going to the INI file and hitting 1 instead of 0 on screenshots, save the file, boot up MW, and i still can't do it, it says the INI says 0. What do I do?

When I go to MGEgui settings and the morrowind ini tab, the box to check screenshots is greyed out, but it's checked.

http://imageshack.com/a/img694/5475/ssq.png

First of all, if you have MW installed in Program Files, any changes you make to the ini file probably won't be saved.
Installing MW outside of Program Files is the best thing to do, especially if you plan on using mods.

But MGE also comes with its own Macro program. So you can set "Screenshot" to any button that you like. This is totally separate than the ini screenshot method.
This is what most people do, as it allows for better customization.

I have MW installed through steam in a "Games" folder, not program files. I aint that stupid.

And I can't find a setting that allows me to set that keybind. Where is it in MGEgui? I can find the Macro editor, but once again, the "take screenshot" place is greyed out. /sigh

MGEgui > Ingame Tab > Macro Editor > Click on a key > Select "Function > Take Screenshot" > Click Save. Next, go to the Graphics Tab, and at the bottom, you can set what settings you'd like for screenshots. I usually set them to defaults but use PNG compression.