The Elder Scrolls Arena let you play as a black woman in 1992. Name another game that did that.
Pretty much every game has offered a world where both races and sexes participate equally, and no one really cares (Morrowind’s racism is always made alien and upsetting thematically).
In Morrowind you can’t be a lesbian with Ahnassi (although the guy who wrote The Lusty Argonian Maid is an equal opportunity HR disaster). One of the rare characters Oblivion bothers to spend time on in a faction quest line is very clearly gay. Skyrim everyone is pan.
And a lot of this is just the same in Adventure Construction Set a series Howard explicitly took inspiration from. The game doesn’t really give that much of a shit about what you look like. It’s far more effort to code in racism, when you start with that kind of open world model.
I’m okay with a mechanical tax on furries. /s
Admittedly, one of my favorite ways to play Morrowind is to use a combination of slavery and farming mods to create an agricultural plantation empire, dozens of farms with hundreds of slaves.