So, in Daggerfall, what happens if my reputation in a region becomes atrocious? I want to know whether there'd be any issues if I were to, say, beat up some guards in the Coast of High Rock region for their loot.

[url=https://en.uesp.net/wiki/Daggerfall:Reputation]https://en.uesp.net/wiki/Daggerfall:Reputation[/url]

With regard to your specific question here, regional reputation being really low (I've no idea exactly how low) in a given realm will have the guards after you for treason. They can show up to arrest you even if you haven't committed any particular crimes (lately), and even if they show up for something like attempted burglary, if you're arrested, you'll still be charged with High Treason. (This is all paraphrased from an entry on the above-linked page page, but I can personally attest to guards showing up to arrest one of my characters simply for showing their face again in a region where they were hated.)

You seem to have been wondering about the reputation system(s) for quite some time. Perhaps try asking somewhere people who work on Daggerfall Unity hang out, like here, or a related subreddit like r/daggerfallunity or maybe r/Daggerfall. Modders are more likely to have in-depth knowledge of how things actually work (as opposed to how the game thinks they work, or how the manual or official guide say they do) than most of the people that just play the game -- even those of us who've spent hundreds of hours on it over the years.

Of course, I still am not out of questions regarding this system:
* Can the guards show up if I'm in the middle of the wilderness or a dungeon?
* If I somehow have bad reputation in the Coast of High Rock region (for example, because I kept attacking the interior door on my ship and fighting the guards that spawn when I do this), will the guards come after me if I'm in my ship, but haven't done this lately?

As a reminder, there's no way I could be taken to court in the Coast of High Rock because there are no courts in this province. Despite being the largest province (it contains all the water area on the map), it has no towns or cities.

(Also, worth noting that I want to know how they actually work in vanilla Daggerfall, not how they were intended to work, or how Daggerfall Unity's developers decided to implement this.)

Worth noting that, I believe, this also happens if you do this in a house you've purchased. (With that said, purchasing houses isn't a good use of your money, given that a ship is cheaper and better since you can access it anywhere on the overworld; houses are only worth getting if you have nothing else to spend your money.)

Then again, this *is* the game where even *planning* to rest on your balcony, of the house you've purchased with your hard earned money, will cause guards to go after you. (I use the term "planning" because this happens before you get to specify the number of hours; in other words, this happens before you would have confirmed that you want to rest, and before you have fully committed to the rest.)

Not as far as I'm aware. (I would guess that the only reason they can show up when you're on your ship is that it's probably classified as a house in the game's code or something.) Not sure. I never purposely went hunting for glitches or weird interactions between (often misbegotten) mechanics; and frankly, purposely tanking my legal reputation in the region where my ship (i.e., my safe haven/loot storehouse) exists in order to get loot that I could more easily get in other ways that wouldn't kill my rep -- or that might, but only in a region I don't care about -- wasn't something that would've cared to try. ...Which is why I suggested talking to modders: While I'm certainly not a modder in the sense of helping to create mods, and I very rarely even use mods, I know that for many games, one of the first steps in creating a mod is understanding how the game (or some of its elements) works natively -- warts and all. (Very much related to the concept that "before you break a rule, you should first understand it.")

Also, while I've never tried the game's Unity implementation, I know that many of the original mechanics (including some that weren't implemented correctly) were not altered for vanilla Daggerfall Unity. For example, one apparently would have to mod the Unity version to get critical strikes to work the way the original game's documentation says they do. I wouldn't even be surprised if some of the broken things that DU got working as they were supposed to can be changed to work the way they did in the DOS version via mods for the Unity version.