Maybe you shouldn't be able to join to Morag Tong if your in an Imperial Guild, but you can join Imperial Guilds if your already in the Morag Tong, as 'infiltration', they might not know your a Morag Tong member, while the Morag Tong would probably know if you are member of a certain faction. Maybe something similar for the Thieves Guild, you can't join them if you are a Fighters Guild member or Legionair but as a Thieves Guild member you can infiltrate those guilds.

1) Helseth isn't a member of the Cult
2) Fighter Guild and Thieves guild are at odds. They even have mutually exclusive quests.
3) Redoran doesn't like the Empire at all! Hlaalu is the only one of the Great Houses that is cozy with the Empire. The other houses don't like being subjugated and having their jurisdiction infringed upon by outsiders.

Morag Tong: You'd think being super secret assassin would mean you could infiltrate... and I think that is plausible. But I'm kinda thinking "no one can serve two masters" so maybe you can join another guild but can't advance to the highest rank? I dunno. No strong feelings either way.

If someone makes a mod that takes advantage of infiltration, then I think that would be really cool.

As for East Empire, I think anyone should be able to take a claim in it, regardless of Guild. :shrug: They are desperate for help setting up the colony, right?

http://uesp.net/wiki/Lore:House_Redoran

"The main focus of House Redoran is maintaining the traditions of the settled Dunmer and, more specifically, the way of the warrior. Due to this focus, the Tribunal Temple is a natural ally. There is also mutual respect between them and the Imperial Fighters Guild and Imperial Legion. They have less respect for the other Imperial Guilds (i.e. Mages Guild and Thieves Guild) and the Imperial Cult religion."

What really concretes this mod as heavily lore friendly is the fact that these faction lines are stated explicitly in Morrowind Prophecies. In fact, I wouldn't be surprised if this is where Xenn drew his information from.

Apparently we didn't play the same game =p.

1) I've been unable to find the quote mentioning Helseth in a cursory look through the construction set, but I did find a few quotes under morrowind lore in the construction set that pertain to membership in both the Imperial Cult and the Temple, which I assume is the salient point. The savant specific line, and a few others, mention that those dunmer who do join the imperial cult are also members of the tribunal temple. If the dunmer can do it, why can't anyone else?

2) Actually, to be entirely correct, one line of the fighter's guild involves a mutually exclusive quest. It'd be entirely possible to play through the entire thieves guild quest, and then the fighters guild, or one arm of the fighters guild, and then the thieves guild. Or even both simultaneously if you're careful. I'd agree that perhaps the thieves guild wouldn't allow you to join, necessarily, if you were already in the fighters guild, but depending upon who allows you to join, say if it was http://www.uesp.net/wiki/Morrowind:Percius_Mercius, there there might be no reason for there to be a conflict.

3) "The main focus of House Redoran is maintaining the traditions of the settled Dunmer and, more specifically, the way of the warrior. Due to this focus, the Tribunal Temple is a natural ally. There is also mutual respect between them and the Imperial Fighters Guild and Imperial Legion." -taken from http://www.uesp.net/wiki/Lore:House_Redoran

You're free to imagine the game however you like, but as existing lore sits, there are very few hard limits as to the guilds one should be allowed to join. Obviously only one great house should be allowed, and in my opinion, bans like the Telvanni and the Imperial Legion might make sense(though, honestly, as ambitious as they are, they also might not care), but I don't agree that the mod is completely lore correct. This takes nothing away from Xenn, especially since the factions were designed(at least from what I could tell) to another's specifications.