no
No Morrowind is a one player game, but I've heard of a failed beta of an online Morrowind for the PC.
All of "arena" is not as graphic as morrowind by quite alot. So everywhere you look morrowind is going to look better, but they are both fun.
1 that i know of, tgm (god mode)
The Daedric Crescent Blade is in Elder Scrolls III: Morrowind. Bethesda included an artifact book from Morrowind in Oblivion, but many of the artifacts cannot be found in Oblivion.
You cannot become a Frost Atronack on Morrowind, the best you can do is summon one.
No.
You cannot play morrowind online, even with a mod.
Yes, you can become a werewolf in "Morrowind: game of the year edition", as it comes with the "Bloodmoon" expansion.
Depends. There are many 'Dunmer Strongholds' in Morrowind, about 9 or 10 of them.
Southwest of balmora
The Lord's Mail is not in Oblivion. In Morrowind there is a book that describes many of the artifacts you can get in the game. Bethesda put this book in Oblivion too, though many of the items do not appear in it. So you could only ever get the Lord's Mail in Morrowind (and Arena + Daggerfall).