1) which is better in terms of skills, quests, open-ended, gameplay, exploring, graphics, and overall fun value
2) where to buy them?
3) Can this play it? (Note: I know VERY little about PCs so this may not even be what you need to hear)-
Intel Pentium D Processor 830
Double Layer 16x Format
Intel 945G chipset
Intel Graphics accelerator 950
250 GB SATA HD
8-in-1 Digital Memory Card reader

Can all of that...er...stuff play it?

4) A big fan of Morrowind and Oblivion, will Daggerfall/Arena be enjoyable to me? (graphics are nice but aint a very big bearing on my enjoyment level of an RPG)

Arena is a http://www.elderscrolls.com/downloads/downloads_games.htm so go ahead and download it.

Both Arena and Daggerfall should be able to run on your computer, using http://www.dosbox.com/.

Easiest way to find Daggerfall, should be to look for it at ebay and amazon. As it's a 12 year old game, it's hard to find elsewhere.

There's only one way to find out

Download the latest DosBox and get the Daggerfall http://www.uesp.net/dagger/files/dagfiles.shtml it will give you a good idea of what to expect from the full game... Before splashing out any cash.

...

You may have to do the Ctrl+F12 to get his framerate up, I know you have to for Arena.

For Daggerfall you can just put edit the core and cycles in the Dosbox.conf file to auto.
And for Arena I reckon that around 25000 cycles should be enough, I think I use something around that, but I've got the CD version, and that apparently got better graphics than the free free/floppy disk version.