I'm going to have to disagree with you on the Morrowind thing. I enjoyed the customizable spell system, but honestly, other than the customization, it wasn't very vast. It was just rehashing of the same 20 or so effects.
I think what he's talking about is things like conjuring food and water, as an example. (Not in the World Of Awfulcraft sense, "lol can i hav sum watr 4 my spels pliz?", but rather in the sense of creating such things purely for entertainment purposes. You could choose from a list of beverages and foods to create, and spread them festively around the town square. (If you were so inclined.))
Also the ability to strike up a camp fire without having to have matches or a tinderbox, an open spell (to circumvent simple locks and unhing chests, or simply to push open an already unlocked version of either if you were feeling lazy that day), a spell that allows you to freeze the surface of water so that you can walk upon it. They would have to be very strange and most likely unique spells, but it'd certainly be interesting to see. A fun suggestion would be the 'juggling lights' spell from the Quest For Glory series. This almost had no use at all, but it would be something you'd imagine a wizard being able to do, and it would be vastly entertaining. This way, wizards could choose to entertain their fellows by making lovely lights dance about in the air. Also, the ability to levitate small objects about with a minor stream of arcane energy. (If they wanted an apple, and the apple was over there, they could get to it without getting up from their seat.)
As far as the fighter vs. mage debate, you have to remember that some of the most popular classes in tabletop roleplaying games are melee combatants with minor to major arcane or divine abilities.
That said, the devs seem to be going for an open-ended feeling. It's difficult to keep things open ended while restricting them at the same time. Though it is in the spirit of realism not to allow a weak stick-figure mage to swing a sword twice his height, likewise a brute mercenary who weighs 250 pounds and specializing in pro-bono, unrequested facial reconstruction to sneak stealthily about, the line is blurry. It's difficult to figure out where to draw it without stopping someone from doing something they feel they aught to be able to do.
I would be in favor of a GM to review background stories to determine whether or not someone can do something. It'd be something you could select when right clicking a player, the background story, and every time they wanted to learn a skill that wasn't particularly aligned to their profession, they'd have to write a decent roleplaying reason for doing so, and add it in there.
It may not stop people, but at least it would force them to be creative (therefor it would stop PLers, who are generally as creative as the sponge I keep next to my sink) and sate the people who are clamoring for a reason that the character would be able to tend to a lovely herb garden on Saturday, while by Monday they'd be off braining orcs with a battle axe.
Lack of creativity should be considered a disease, I think that's my final word on the subject.
--Polar
(Oh, as a sidenote, I like Moon's take on the weakness/strength system, though from a completely roleplaying point of view. That way you could more accurately roleplay someone who'd say, lost an eye in a tragic 'tavern related incident'. This is something like the customization system you see in GURPS (generic universal rolelaying system) a tabletop RPG. You are allocated a certain number of points by the GM, and then they give you a certain number of points of weakness you can take (1 eyed character, sterile character, compulsive gambler, the list goes on for pages and pages) to add points to your pool, with which you must purchase your stats from (str, dex, etc) and can then buy advantages with (character with an extra arm, character with natural armor, character with gills, etc.) This is balanced though, so that the player can't just take 30 disadvantages, and be playing a blind, one foot tall, one eyed, parapalegic, compulsive gambler/drinker, who has 40 points in strength (twice that of a superhuman.) It doesn't have to be balanced in such a way in a roleplaying sense, but one has to temper here and there.