If you want to improve the graphics in Morrowind for whatever reason, then get MGE (Morrowind Graphics Extender). It can raise the quality of the graphics to near that of Oblivion if used correctly.
Also, get both the expansion packs for Morrowind, Tribunal and Bloodmoon. Specifically Bloodmoon, because it adds a whole section of land to the game.
If you can, get the expansions for Oblivion too; Nights of the Nine and Shivering Isles. Again, if you can't get both, get Shivering Isles, as it adds more to the game I think.