Glad to see someone else getting into Daggerfall!

For the way people react to you: That's going to be based on your reputation with their faction that you set in character creation + your Personality stat. I just made a hoity-toity Paladin-eque character and I set his reputation with nobility really high and underworld really low, with commoners just a little bit low (-2)...Asking people in town for stuff results in a lot of turned up noses telling me to stuff it. Lol.

But also, for commoners, picking the Blunt option (your Streetwise skill) when speaking to them usually helps, and picking Polite (your Etiquette skill) usually makes them dislike you because it makes you talk like the upper class.

I spent hundreds of hours in the mid-to-late 90's playing Daggerfall, which meant using it's original control scheme; if you haven't tried that out...you should, just so you know what it was like (but I recommend using the Normal setting for reflexes because you will not be able to attack/do stuff as quickly). Pro tip: In that control scheme, to look with the mouse, press Enter to enter Mouse Look mode. Press it again to go back to movement/interaction mode. The Home key centers your character's view again, and Page Up/Page Down look up and down if you don't want to switch out of interaction mode. Holding down the mouse button and literally moving it in a direction to determine the type of attack (side to side for swipes, forward for stab, backward for overhead swing/kick) was certainly unique, even for the time. WASD controls didn't become standard until after Quake and Half Life exploded onto the scene.

I highly recommend the following mods which add great quality of life changes without changing fundamentals about the game or quests. If you don't want to load your game down with a ton of mods, I urge you to at least grab the top two in my list as they modernize the game in the same way that Daggerfall Unity modernized the overall controls with a WASD + Mouse Look control scheme:

• Cruise Control - This is one of the best QoL improvements here. It's important that you know about interaction modes, how to select them and how they work, but having them default in obvious situations makes it play a lot more like a modern TES game (such as defaulting to Steal mode when you are Sneaking, and Info mode when you're far way or something can't be Grabbed/Talked to, so you can walk around town looking at buildings and clicking to see what they are. This is the easiest way to fill up your map for shops and such if people don't like talking to you/you don't want to sit there and click on every single dialogue option over and over).
• Sneak and Crouch Combined - This is the other really big one in this list. Sneak and Crouch are two separate things in Daggerfall. Crouching does not necessarily help you sneak (though I think maybe a little since you move slower?), and you can Sneak while standing. Doing both slows you down even more, and you have to remember to stop sneaking and stand up afterwards. This mod just makes the key to do either always do both, like modern TES games.
• Multiple Quick Saves - There's no such thing as saving too often in Daggerfall.
• Simple Mini Map
• Rest Warning if Unwell - This will literally save your life, because if you catch a disease and then go to sleep, you will die.
• Viewable Skill Progress
• Autosaves* - No, seriously, there's no such thing as saving too often in Daggerfall.*
• Unofficial Block Location and Model Fixes - Fixes some actual graphical and interaction issues with some 3d models and such.
• World Tooltips - This makes everything show what it is when you mouse over it like in modern games. WARNING: This will reveal secret doors and switches to you. So, I consider this one to be much more optional in setting up a new DFU install than the others because that does change the way you play. However, with how insanely huge/labyrinthine the dungeons can be...let's just say I don't have the kind of time I did 30 years ago wander aimlessly clicking on every wall panel in the dungeon to find the one secret door I needed to open to get to the quest objective. Plus, the game's default 3D mini map often will load in such a way that it reveals many secret areas anyway.
• Subtitled Cinematics
• Convenient Clock
• Physical Combat and Armor Overhaul - Another optional one, IMO: If you want to not spend an inordinate amount of time missing enemies, this mod makes the combat work like modern TES games where you always hit, but all the numbers from weapon/armor/dodge skill/etc still factor in to the amount of damage done and such. It also fixes the Critical Hits skill to actually...do critical hits. In default Daggerfall, that skill actually affects your chance to hit, not how much damage you do. Meanwhile, the manual that came with the game was incorrect and told you that it affected your damage. >_<