This is not true. I have it installed in a new directory on C drive and UAC still needs it to run as an admin to rlfunction properly. In theory, you would be right. But when it comes to Windows theory rarely is relevant
The adminstration problem can be avoided if you install the game outside Program Files. Windows doesn't allow Morrowind to change registry settings or to access files, since the game was pre-Vista and hence had different way of doing things. If you install Morrowind outside Program Files, Windows doesn't mind it much. Same is true for almost all games, softwares which were released before Vista came out.
Not having MGE and Morrowind set to Fullscreen prevented MGE from hooking. Once set, it would hook but then crash. Morrowind.exe shouldn't have to be set to Run As Administrator. MGE must be, and Morrowind Launcher.exe may have to be. I have to run the launcher as an admin only when changing settings, but a friend needs it set that way indefinitely or MGE won't apply settings. Comparability mode causes serious issues for me on 8.1 and I have yet to use it successfully on any programs, but may be effective for others. Disable Desktop Themes is not an option in 8 and 8.1 from what I can tell, but I know it seriously helped on Windows 7, especially when running Oblivion. Thanks for the help. Cheers.
I have UAC in default level and I have Morrowind installed in D drive. I did not need to run Morrowind or MGE or any tools as admin to make them work correctly. I have custom keyboard mapping ( which is stored in registry ), and it works correctly.