Phew, glad you don't mind criticism. Some people just can't take it. I can't really give a whole lot of criticism at this point, considering the story is already done and posted, as most people get better as they write, so I'll just get the big things out of the way.

My biggest complaint, besides the occasional odd dialogue (are you trying to copy Shakespeare or something? Make it more 'authentic fantasy'?), you're using a character archetype I like to call the "Mild Protagonist". Basically, he and his friends/allies are reserved characters in a world where everyone else is an extremist. For example, instead of natives treating outsiders with disapproval and neglect, there are open hostilities. At least it's far better character type than a Gary Stu. Other than those two, the story is pretty good.

Another discrepancy, the Tribunal claimed Nerevar defeated Dagoth Ur, who fled after losing, and Nerevar returned to the Tribunal before he died. The Nerevarine Prophecies are fiercely denied by the Tribunal, since it's stated that the Nerevarine will denounce Almsivi, and bring back ancestory worship. Most Tribunal faithful don't believe in the prophecies, and denounce the Daedra.

“I am smiling,” I said, “because they threw me out before I paid for my meal.”

Just desserts. Your character interactions are a little on the stereotypical, I'm sorry to say, but not overly so. Arrille's sanctimony was a little overdone, but at least it added some flavor to an otherwise drab interaction.

The story flows well, you've got a good sense of pacing. Not too much detail and not too little, things move at a decent clip. I don't recall seeing any spelling errors, but I did notice a few grammatical ones, such as "Why did he not simply 'looked' up". I don't know if you actually proofread your work or simply do a spell check, but these instances aren't very common so they might've just been overlooked.

It seems, so far, that Zaden isn't a prisoner being released, but someone randomly placed on a refugee ship. That said, I found it a little odd for him to suddenly say at the end of this chapter, "I was finally free".

Otherwise, very interesting story.

Interesting. You're certainly making this story your own with a lot of deviations from exactly what was in the game. That opens up a lot of creative freedom. There are, however, a couple of descrepencies from TES lore. They talked about crossing the Eastern Sea, but Morrowind is part of the Tamriel Continent, and Vvardenfell is an island volcano who's surrounded on three sides by the Morrowind Mainland, separated by a few miles of ocean inlet. Where do you think Mournhold was?

I can't really blame you, though. I didn't discover a TES Lore website until nearly a year into my novelization.

Well, I'm not familiar with this fandom. But since you asked...

Work on dialogue--it's good, but some of it is stiff and words are repeated. Real flowbreaker. It got too overdramatic at that bit with the woman, but otherwise fine. Good sense of suspense with that conversation. Also, I don't know about the first person narration. I'm generally against it, but maybe you'll make it work. Even so, some bits sound very wooden. A re-edit would help.

~D

Ah, the plot thickens. This does not mirror the plot of the game, but that is not necessarily a bad thing. In this case it's fine. The Blades contacting Zaden rather than Zaden going to Caius as directed by a note is a nice, more realistic touch, the silt strider trips put some flesh on the suspiciously instantaneous trips around the island, but best of all, the "hero" of the story gets a friend and a mate. Both relationships are nicely done; neither is one-sided or without ups and downs.
I have mixed feelings about the dark lord who is hunting Zaden. I think he is a nice addition; I'm just concerned that he may unbalance the plot - an adversary that's too powerful at this early point in the plot/game. I haven't played through the entire main quest at this point, however, so my fears may prove to be unfounded.
In any case, I've enjoyed following this story and I will continue to read through it. Thanks for the effort.

Nice job with this first chapter. I'm glad to see the story rounded out a bit - beyond what the bare game offers. An explanation (interpretation?) for some of the events that the game, by necessity, presents only in two dimensions is something I appreciate as a player. The strongest part of the chapter is the dialogue. Adding some characters to the boat certainly helps move the plot along. I'll read through the other chapters as time permits. I notice that this is a very recent effort - August of 2009. I'm just playing through this game for the first time as I'm reading this story and looking ahead through the chapters I notice that the story does not reflect the entire arc of the game. I'm guessing that you are writing the chapters as you are playing through the game yourself. I'll be interested to see how you flesh out the game's narrative as you play through it.
Regards,
Ted S