Sweet! Thanks for the replies guys. It's been 2 years but still unfixed, and unable to play Daggerfall sadly.
kheldorfrombatmud wrote:
The first time I gave up on a dungeon crawl I decided I'd cheat, and attempted to change the Z file cheatmode to 1. I got an error saying I didn't have permission to do so. copy paste to desktop, original file--->recycle bin. copied file allows me to change it--->back to daggerfall folder. When I saw this forum it struck me that perhaps user account control could be the issue, so I turned it off. I also changed permissions for users (me) on the entire bethesda folder. Since then I reinstalled without the additional quest packs, thus failing to test whether my changes had any effects. I'm not willing to risk freezing again.
**UPDATE** The game works perfectly without the added quests, without the user account control, and with permissions changed on the bethesda folder. Thus the game is playable, but I still dont know what caused the freezing. I'll not test other people's add-ons nor do I feel they should be included in the daggefall download without a VERY CLEAR warning that one or all of them make the game unplayable.
The only other info I can offer is that though quest rewards froze my game from the start, it only became unplayable after I did the wayrest prince's quest
This response gave me a shining light. I tested all these to make sure your tests were not in vain.
Tried full controls on Beth folder = no
Cheatmode change = nope
User account control = really not sure what you meant by this but tried clicking every button on Beth folder controls
ReInstalled w/ almost every single different option = Still no.
Though,
I have not tried a clean save. I feel maybe any of these may work if I do.
Here are some more things I have gathered lately w/ the issue:
--Different messages on the DOSBox prompt when the issue is going on, like;
"Unable to Write _____", or
"Error 112"
--Getting a new system did NOT help

(upgraded computer recently)
--I am able to play the game by clicking on the DosBox shortcut. Instant Start. w/o having to mount hard drive or type commands every time (maybe this has something to do w/ it?)
Hope this helps anybody else trying to solve this wretched issue.
And if you find solutions, for the love of god please tell the internet.