Like ComatosePhoenix ninja'd me in in saying, green-highlighted items in your inventory in Daggerfall are indeed quest items; you needn't carry them around in your personal inventory all the time, though -- a cart should be among your first purchases in the game, once you can afford it (and it's really not very expensive). Also, you can drop things in piles inside a house or ship that you own, and they'll be safe there (though either of these is considerately more expensive than a cart :P ).

I think you could even start with Baldur's Gate. Solid story and the slow progression is actually nice for beginners as you have ample time to get familiar with the spells and mechanics of the game.

I'm digging the conversation here. Although maybe I should take some of your all's advice and just read the manual. However, I was hoping instead to have people hold my hand and tell me I'm pretty. Haha.

Dragonage Origins

or

Divine Divinty / divinty 2

Might I suggest Septerra Core? It's fairly uncomplicated. More of a jrpg than a western style rpg, really.