Restrictions are fine if they can be done with some degree of accuracy, which doesn't seem likely, since they aren't accurate in any of several mods at present. Abot's, for instance, detects "water" in some houses at odd times (such as the one in Balmora "vacated" by an Orc bandit through a FG quest), and I've walked down to the ground floor on more than one occasion to find fish swimming peacefully through the living room.
Not being able to light a fire in an interior might be believable due to the extreme risk of setting the place ablaze (the heat's got to wreak havoc on the ceilings), but when there is no fireplace or stove, you don't have much choice. No sense in living in a house in Balmora, or an ancient Dunmer Fortress, if you can't even cook a hot meal there; otherwise, I'll take a damp and musty bandit cave instead, the services are better, thank you. Somehow I can't picture all of the citizens of Balmora eating their daily meals at the Inns, which strangely don't all have cooking facilities either. Either the restrictions need to be lifted or rethought, and/or a few more places could use the addition of some built-in amentites instead.
A wandering guard or a random chance of being woken and either being told to "Move it, NOW!" or else being fined for a second offense would be a big improvement over bedrolls somehow not unrolling in certain places.
Indeed, I agree that items need to be placed in world to compensate certain things (such as if restrictions remain in, configurable or not). This is something I would have no problem with doing myself during the leg work portion of the development.
Further, I don't know why everyone is assuming that there is a need to eat and sleep at inns, or that the restrictions force this - they do not.
In regards to food, a player can hunt to gather raw food and cook it, buy food at Taverns or Inns (which act as restaurants it seems in the Tamrielic community), and Traders would also be selling food stocks I imagine (if not more folks as well). I don't deny a number of houses in the game could certainly do with having some more cooking related items in them (especially since NoM does offer some options that in most cases would be easy to worm into almost any vanilla location). This would add further ambiance to things anyways.
In regards to sleep, a character is certainly not being forced to sleep in Inns with the present restrictions. Certainly, the character can acquire a home in many locations to be able to bed down, or they could use the beds in a local Guild Hall if one is available. In some instance, the character may have friends who offer up the use of their beds (Caius in Balmora anyone, right in his dialogue). Further, the player can get a bedroll as well for traveling and sleeping in the wild places.
Either way, if the restrictions are made configurable, it would benefit being able to supply both play styles with their desired effects in the game. I also don't think it would be a bad idea to check to see if the MCP or MPP could possibly correct the water levels issue (at least with Vanilla locations, modders would need to do this themselves on already released mods if they wanted to do so). Personally, considering the way the game behaves with this issues, it must certainly be a glitch and not a feature, so perhaps it bears correcting. If this could be done, we have cut even more problems out of the current restrictions.
Granted, I do agree, in terms of using the bedrolls, I would love to see the guard idea if it can be done (simply because, as pointed out, that is even more realistic than a restriction - sometimes it might work, sometimes not). I have no idea how this would be pulled off, but mayhaps someone who ends up working on this will be a wizard in that department. I wonder if perhaps something similar (though different in application) could be done with fires, perhaps upsetting NPCs in the area if you light a fire in their home? Maybe warranting a fine if you are caught/seen doing it (I say caught/seen so that one can easily do it if no one is in the location) could be put into place (as you attempted to commit possible arson).