Does this also mean that I can resave an existing mod in the CS with Texture Fix included as a master and thereby inherit the fixed seams? Or does this only work when creating new mods?
It will work for mods that do not contain landscape data already like if you want to expand/alter an old mod and subsequently make landscape changes.
If a mod has landscape data in already then when playing the game or working in the construction set, Morrowind loads first putting in place the original landscape complete with all the original seams. Texture fix should load next with landscape data overwriting almost the entire landscape data of the original so the land you see
in game or in the construction set is texture fix not Morrowinds, After that , any landscape data contained in mods will subsequently overwrite texture fix thus replacing the near seamless data with whatever data is in the mod which is usually a few exterior cells of Morrowinds default land complete with the original seams being put back in game in the affected areas.
If a mod is putting texture seams back in game then the landscape data within the mod needs to be fixed separately. either by deleting the landscape data and redoing it from scratch or by simply repairing the land contained in the mod.
The bottom line is that for a mod to inherit the 'seamless' landscape data contained in texture fix then the land in view in the construction set must be Texture Fix's not that added by a mod and the land must be altered in some way , perhaps raising the land slightly and lowering it back, or changing a texture then putting it back or a tiny squirt and subsequent removal of vertex shading are enough for the construction set to register a change and to import the landscape of the entire exterior cell into the mod.