I used this in conjunction with Kezyma's UI that you recommended and Skyrim style splash screens from 2014 it all blends magnificently and adds a new feel to the game for me. This fits is nice and is a good way to start the game; it works in OpenMW as well so I am enjoying it all.
He means from when u start the game and it says "Bethesda presents...Morrowind, blah blah blah" at the beginning of the game. it goes from a yellow and orange background and then it just jumps into the new background awkwardly
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Textures folder means Textures folder, not the Video folder: Morrowind\Data Files\Textures
If there is no Textures folder there, make one and stick the "menu_morrowind.dds" file in that folder.