I have a question: one of the major things that gave Morrowind it's stunning look and atmosphere for me back in the days I first launched it was Jeremy Soule's game soundtrack. Oblivion's OST was not that good to me honestly. Is it possible to import it to the game?
I know that I simply can replace the sound files but is it possible possible for the game to play original Morrowind soundtrack while being on Morrowind island and swap back to Oblivion's OST when you get back to Oblivion locations?

#1
Here is a list of the tracks: http://uesp.net/wiki/Morrowind:Music
Here is how music works in Oblivion:
Therefore, in order to make music play in Morrowind and switch back to Oblivion when you traveled, someone would have to write a script that detected what worldspace you were in (similar to the world transport mod) and then renamed the files in these folders accordingly. OBSE would probably have to be used for this.
For example, let's say you've got these in your music folder:
oblivion_dungeon_music.mp3
morrowind_dungeon_music.mp3
The script would detect you are in morrowind, and disable the oblivion file by renaming it so that the game would only detect and play the morrowind version:
oblivion_dungeon_music.disabled
morrowind_dungeon_music.mp3
Then when you went back to oblivion, both files would be renamed to flip-flop them:
oblivion_dungeon_music.mp3
morrowind_dungeon_music.disabled
Obviously this would have to happen for all of the files in all of the music folders.