It should be known that Daggerfall was only beginning to crawl out of the days when the cultural customs of Tamriel were mostly cliche'd DnD medieval fantasy stuff, but still, all sorts of entertainers, menstrels, and other musicians can be found in the taverns. Originally, there were supposed to be bards in some of these taverns, with songs (arranged from a database of rhyming verses) that would match up with one of several potential rhyme schemes.
You can still find these lines in the game's files, and http://www.imperial-library.info/dogate/randompoetry.shtml has compiled a list as well.