Morrowind's probably the TES game with the deepest RPG elements. You can pretty much do anything and it has several endings. The only downside is that combat. You have a hit percentage that activates for each swing, IIRC. Be prepared to miss a lot even if your weapon goes right through some douche's face.
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That would make me laugh. Swing a sword right at an enemy. It misses and does no damage when you're standing right in front of them. I'd be upset but amused