Can't item hunting be enough of a reward?

(See, for example, the Metroid series; items and boss fights are literally the only rewards for exploring in those games, and exploration still feels like the most important part of these games.)

Except in your example, along with simplifying and streamlining the mechanics -which I can admit, some of the mechanics in Morrowind (mainly just choosing your starting stats and leveling up, and the combat) were a bit archaic- they also simplified the narrative and story and made it less interesting. :P

Also, I don't get this weird argument about ARPGs. Diablo/Diablo 2 are universally described as ARPGs. Them and the games like them are literally all the genre "ARPG" is used to describe now.

Sentence 2 may be true, but sentence 3 is not. Again, I can point out games like the Ys series that are described as ARPGs but are clearly not Diablo-likes.

(We could also consider a hypothetical game, which is structured like a Diablo-like, complete with the way leveling up and loot works, but has the basic gameplay as a rogue-like (with enemies doing nothing except when you act). That game would still have a lot in common with Diablo-likes, but would not fit under the ARPG category.)

Add in some chatter about local events... Or lovely designed interiors which tell you about the personality of the shopkeeper (Witcher 3 excels at this)... Shoptalk! (done really rarely... ), other customers discussing the wares and prices...

It seems you are right. But then it seems you isolated the wrong part of the statement to voice disagreement with. It seems you disagree with the conflation of ARPG with "Loot-based games", rather than ARPGs with Diablo games.

Actually, I have seen people imply that ARPGs, unlike RPGs, are loot-based, when that is not how the genre distinction works (particularly considering games like Etrian Odyssey and Ys).

where are you seeing people calling Ys an arpg?

I like a mixture of both. The Job board where farmer Joe needs help with his jinxed cow Bessy & the hidden quest which you get when talking to that one weird beggar on that street in this one town area.

But more than that I love when it feels like optional stuff is meant to be optional. Not "Oh it was optional but if you really want to win that fight in this fight in the boss dungeon you should have done all of them". One reason why I stopped PoE; doing everything possible to do and still feel your group is at lvl1-2. While doing everything optional in BG/BG2 really feels like it makes a difference.

For one thing, the Wikipedia article mentions Ys. (Of course, it also mentions Zelda, which is a bit more controversial here; "Is Zelda an RPG?" topics have been known to become more heated than this one.) Also, the TV Tropes article includes the Ys series in its list of ARPGs.

Optional content is called optional for a reason.

Part of the point of RPGs is to explore. Put everything in one easy-to-find location then there is no more sense of discovery.

Incidentally, one idea that I have had for a while, is that RPGs should clearly mark NPCs who either:
* Provide services when talked to
* Whose conversation triggers effects other than dialog, like setting a quest flag (must talk to this person to continue), or starting a cutscene (like one that results in the party being sent to jail). This would cut down on the frustration considerably.

I am also of the opinion that, if walking over a certain spot triggers a cutscene, that that spot would be clearly marked. One thing that can be rather frustrating is if, before you finish exploring the dungeon, you hit a cutscene trigger that sends you away with no way back. Also, the level designer should find some indication of which paths lead onward and which lead to treasure, so players can choose whether to look for treasure or press onward.

I disagree,part of the fun and interest in a game is locating the shops.Now if it was allocated to one spot in the game then that would be very boring and with all the gear in that shop it would seem like ''real time'' shopping.As for quests it's fairly easy to identify the non playing NPC from an important one.Granted some games are slightly awkward but overall they have got it right.For instance,NPC's in F3 and FNV are either citizens/guards/etc that meander from spot to spot and the important one's have a name (title),now if you can't figure that out then RPG's should be nuked from your pc.Yes,I saw post 20 little backflip from post 1 so no need to refer me to it.

That's lame and immersion-breaking imo, such streamlining kills all the joy of exploration and makes it much harder to identify with your character.

Such a flagging system would be very useful for me. I often have to run around and try to guess how to NOT progress the plot, while looking for sidequests and such. I am also tired of rooting through every crate and interrogating 40 people after every story beat.

These days, I don't want most games to have large tracts of land - rather, I want about 20 characters, all living within the confines of a small town. More like Harvest Moon, less Baldur's Gate.