I haven't used the level 6 mod, but it should be ok - if that's what you want. Please be aware that you get attacked by these assassins regularly, until you start the Tribunal questline (unless you deactivate them).

The only plug-in's I use myself are Master Index + Journalfix (interesting quests + a convenient travel method) and the Tribunal Delay mod (complete main quest version) which I simply deactivate if / when I want to play Tribunal. This has always been good enough for me and my personal playstyle (I do play a heavily modded version of Oblivion, because the base version alone demotivates me too much, but that's a different story).
I have never used any graphics mods, so I can't comment on them.

You could consider simply deactivating Tribunal, and playing the base game as it is. The Master Index plug-in + Journalfix are nice, but not necessary to enjoy the game, if you are looking for a rich role-playing experience. Once you have more experience with the game, you can understand better what the plug-in's do and decide which ones to use (if at all). When you want to play Tribunal, simply activate it (but I wouldn't recommend Tribunal to inexperienced players, although technically you could play it at level 1).

For many players, especially new-comers, these improvements may be too important to recommend deactivating Tribunal

Okay, taking various information from the above, I've got the following list. Does this look good?

1) Install Morrowind from the GOG.com installer and run it once to create the necessary config files.
2) Install the Morrowind Code Patch.
3) Install the Better Dialog Font plug-in.
4) Install Timeslip's Morrowind EXE Optimizer.
5) Apply a 4GB patch (from ntcore) to allow the game executable to address additional memory.
6) Install the Morrowind Patch Project (I found a fixed v1.6.5 beta - by BTB I think).
7) Install the Morrowind Graphics Extender (MGE). I have version 3.8.0b, not the XE version, due to my old PC.
8) Apply the DelayedDBattacks plug-in to delay Tribunal.
9) Apply Illy's Solsteim Rumour fix.
10) Apply the cleaned and fixed mini-expansion data files.
11) Start the Morrowind launcher and turn on the plug-in files for the above.
12) Start a new game.

The latest version is Morrowind Patch v1.6.6_beta.7z and you can find it, together with previous versions, at the following link: http://www.theassimilationlab.com/forums/files/download/1060-previous-patches-unofficial-morrowind-patch/

Among other issues, there is a quest (in Bloodmoon) that is broken by 1.6.5, but fixed in 1.6.6.

Cool, got it. I guess that makes the BTB Edit version of 1.6.5 obsolete then?

How does the rest of my plan look? It is pretty much Lambonius's install order but with a couple of added steps like the Better Dialog Font and the cleaned mini-expansions. I also added in a run of the vanilla install to create the default configs which I would imagine is a required step, but can the plug-ins all be added in and then activated in the launcher or do they need to be added in the launcher after each step?

Looks good. You might want to try out MGE XE, just to see if your computer can handle it--MGE XE's default water effects look MUCH better than the ones MGE, and XE's GUI is a little easier to follow. There are a ton of modular options, so it's possible that you may be able to disable a lot of the system-taxing effects and still get a relatively decent frame-rate.

Yes, 1.6.5 is obsolete.

The rest seems good. If that is all you want to install, you don't need to bother with cleaning stuff.

It is preferable to activate all the plug-in you want to use, and by that I mean all the files with extension .esm or .esp, before you start your actual game.

It is possible to add and activate additional mods mid-game and use old savegames, but it is tricky and it may ruin your game if not done properly. In that case it would help to use some of the more advanced tools mentioned in one of my previous posts, like Wrye Mash for example.

Well my GTX260 is Shader Model 3.0, so I guess it meets minimum requirements.

Is there a download location for MGE XE (latest version is 0.9.10 right?) that isn't nexus mods? Only I don't want to have to create an account there just to download one mod that is larger than 2MB (it looks like it's only 11MB anyway).

This seems to be the only other one I could find at a glance, but it's a slightly older version. Looks like you can patch it to version 9.10 using the additional file linked at the bottom of the page.

http://downloads.fliggerty.com/download--875

I just ran MGE XE myself on my 3 year old laptop with crappy integrated Intel card. I can get a reasonable draw distance with a decent framerate, as long as I disable the shaders and AA and such. It's very tweakable, and still looks better than the old MGE. I didn't realize how different some of the visual effects were until I ran them both back to back today. :)

Thanks, just downloaded them. Will give the install a try out tomorrow night. Just gone midnight here and I need to get up for work tomorrow. :P

I imagine I can probably merge the two archive contents by overwriting files from the 0.9.10 beta and repackaging into a new archive (keeps my saved files tidier).

Will look to post back here tomorrow after I've given it a try.

Well, it worked. I did hit a minor hitch when applying Timeslip's EXE optimizer. It ran a while then started crashing out with errors like 48.exe has stopped unexpectedly. Continue and then 49.exe has stopped unexpectedly. And so on. Did a search in Google and found others had crashes with it that they solved by running it on one core and turning off the benchmark patches. I did this (it automatically restored the backup exe) and it patched it fine on that second attempt.

Anyway, I used MGE XE, but left most of the settings off as per default. Only added shaders for Bloom Soft and Sunlight Shafts. Distant Lands I set up using the default settings. It works fine, but there is a slight FPS drop when I got to Balmora. Nothing gameplay stopping, but you can tell that the framerate isn't a smooth when those more distant objects are visible. Water and sky looks nice.

The rest of the steps seemed to go fine. Hopefully that's it then. :)

Nice. My setup has all shaders turned off, and dynamic sun lighting turned off, draw distance set to 7, min statics set to 150, textures set to highest possible size and land mesh set to highest possible. Framerate pretty solid, though noticeable dips do sometimes occur in the heavily populated areas. Glad you found something that works for you though. Cheers! :)

Exactly what I was seeking.