there were flaws in how both morrowind and oblivion approached loot. morrowind had static items but they were always in the same place so after a few playthroughs you knew where everything was. oblivion just had random crap.......not much to add to that.
i suggest that at the beginning of every new game in skyrim there is a list of say 200 items to choose from. the game then picks 150 of them randomly and puts them in random locations in the game world. someone posted that they could be held in visually identifiable shrines or boxes or something so that you arent forced to look through every single barrel and crate in game. obviously areas around cities and towns would not make sense since someone would have found it long before you were poking your nose around their village.
its important that all of the selections are made at the beginning of the game otherwise you will have "borderlands reload syndrome" trying to find loot that just a bit better than your last attempt.......ive wasted hours on games doing that and id rather not have to go through that again. :facepalm:
as for the items themselves they would spawn at the current level of the player but as the player increases in level they can pay a mage or shopkeeper to upgrade it for them to match their level. this gets rid of that issue in oblivion where you didnt want the really good weapons early on cause they were permanently stuck at that level