You must be at least 3rd level to activate this quest and you must activate it on your own (you do not get an invite).
You start at Castle Daggerfall.
There are three NPC's that you will have to talk to in this room. For right now, you need to talk to Queen Aubk-i. King Gothryd will behave as any noble NPC (offering you the occasional quest if you click on him) until you have almost completed the Main Quest. So, unless you're interested in doing a random quest for him, just leave him alone for now.
Queen Aubk-i at Daggerfall Palace (that's her, above) will ask you to go check up on the Queen Dowager, Nulfaga. Nulfaga lives in Shendungent, her castle in the Wrothgarian Mountains. It is almost all of the way to the eastern edge of the map and is the only orange dot in the region (assuming you haven't been adventuring in the province), so it is not hard to find. Nulfaga hasn't been quite right in the head since Lysandus died and you are to make sure that she's still alive and kicking.
Nulfaga (the charming lady above) is Lysandus' mother and Gothryd’s grandmother. Report back to Queen Aubk-i after talking to her. There is a time limit on the mission, so be careful of your travel time (it's a loooong way to Shendungent and back again). If you are playing the release version of the game, you will be given some ungodly amount of time to complete this quest (a few game years, if memory serves). The time is more realistic at about 150 game days.
When you get to Shendungent you have two choices on how to approach it: the easy way or the hard way. The hard way is to wander around until you make your way into the room right in front of the entrance. If you want to do it this way, head west from the entrance and up. You'll be looking for a lever in a side room behind a secret door that will raise a portcullis, which lets you get into the corridor behind the main room. At lower levels you'll find Shedungent populated by Mages and Battlemages, but at higher levels you'll find liches and their ilk. The Queen Dowager will be up the stairs. Talk to her and that's all you have to do besides get out again.
The easy way is to click on the Daggerfall tapestry beside the door that's right in front of the entrance (the Daggerfall tapestry is the green one with the Dragon on it). Say the magic words ("Shut up") and the door will open, you can kill the two bad guys in the room, go up the stairs, talk to the lady and leave. Queen Aubk-i will give you a few gold pieces for your troubles and you will be on your own again.
Morgiah’s Letter
This quest activates automatically when you reach 3rd level and try to fast-travel. A letter from Morgiah just kind of magically appears in your inventory. You must travel to Wayrest and speak to Morgiah to start the quest. She’s kind of hard to miss: she’s the hot number in the red dress at the top of the stairs.
Like everyone else you’re going to talk to, she won’t tell you what she knows until you do something for her. Specifically, you need to deliver a message to the King of Worms at Scourg Barrow in the Dragontail Mountains province. Scourg Barrow is in the southeast section of the province so you will need to move the map over and down before you can find it. There is a fairly tight time limit on this quest, so anchor a “Recall” outside of Castle Wayrest before heading off to deliver the message.
When you enter Scourg Barrow you will be in a room with 7 sarcophagi. The middle one on the western (left) side is the one you want. Open it and levitate or drop down.
The sarcophagus in the middle at the north end of the room opens a shaft that leads down to a room with two Mummies. If you are hard up for gold, you might want to take a peek. The only problems I have experienced with this are that the Mummies always want to stand directly underneath me (they can hit me, but I can't hit them) and the only way out of the room is via "Levitate", "Recall" or restoring a saved game. It's a general pain in the patootie, so I usually pass on that one.
Follow the corridor until it ends in a door. There will be two zombies on the other side. This a pretty tough fight for a low-level character, so you will want to save the game, just in case. Once the zombies are taken care of, go through the southern door on the west wall (that's the one immediately to your left as you enter the room)
Follow the passage on the other side of the door to a T-intersection and go left. (If you are really into exploration and want to fight a bunch of baddies, you can turn right at the T-intersection. It leads to the rift the Morgiah mentions in her directions.) Go into the cave and down. You will run into four bats. When you kill the fourth bat, look down and to your right. You should see a slope down. Take it. You'll some to a short T-shaped stone corridor. The door to the King of Worms' throne room is on the left in the middle of that corridor.
The door will be locked. You can pick it, cast Open on it or just bash it in. There is nothing on the other side that will hurt you, but it sounds like it. You can shoot arrows at the Vampire Ancients and Ancient Liches, but do it after talking to the guy in red. If you try to melee they will definitely fight back. It might not help your rep with the Necromancers any, but it sure helps your archery skill. Bring lots of arrows and a really good bow.
Once you talk to the King of Worms, he will give you a letter to deliver to Morgiah and you can beat feet.
You get back out the same way you got in (assuming you didn't anchor a "Recall" spell somewhere). When you get to the hole where you came down and if you don't have a "Levitate" spell, click on the tapestry on the left-hand side of the corridor. It will cast "Levitate" on you so you can get back up (you may have to click a few times to get it to activate for you). You can also climb if you want, but it's a little hairy finding just the right spot to climb up. Good for the climbing skill, though.
This place, by the way, is the headquarters for the Necromancers Guild. It seems to have been the original intent of the game to allow you to join the Necromancers, but it was not operative in the release version of the game. Perhaps in "TES3: Morrowind"? Only the developers know for sure.
When you return to Morgiah, she will tell you that an orc chief named Gortwog has the letter you need to find. She will tell you to talk to Mynisera, but to get to Mynisera through someone else. She doesn't say it, but the someone you need to go through is Mynisera's maid, Cyndassa, and you'll find her back in Daggerfall Palace. Morgiah will also give you a trinket for your troubles.
Mynisera's Letters
You must be at least 3rd level before you will be offered this quest. At some point after checking on Nulfaga, you will receive a letter from Queen Aubk-i asking for your help again. She wants you to retrieve some letters from the Dowager Queen's castle. Confusing, huh? Daggerfall is blessed with two Dowager Queens. Nulfaga, who is Lysandus' mother, and Mynisera, who is Lysandus' widow and King Gothryd's mother. OK, genealogies out of the way, let’s get on to the Quest.
The dungeon is supposed to be random, but the system tends to favor Castle Necromoghan in the northeast of Daggerfall province. The location of the letters is random within that dungeon, but the game tends to prefer a couple of standard locations within Necromoghan. Rather than put up pictures of the whole dungeon, I will walk you through the few quest object locations in the dungeon (it will make your life easier when you have to go back there for Guild quests).
From the entrance, with the entrance at your back:
Face right, go down the corridor (bad guy a little farther down), turn at the corner and go up to a room with a hole in the floor (a couple of critters in this room (sometimes) and a treasure pile). Pull the lever and catch the elevator up to the next room (four critters in this room and four or five treasure piles). This is the first quest object location -- if the letters are here they will be in the back corner of the room near the elevator.
Standing on the elevator and facing the lever, go out through the door to your left, turn left and follow the corridor (do not go through any side doors). There will be two critters at the first ramp going up and two critters at the next one (these are what you will find in the room you’re headed to). There are none at the third, but there is one critter around the corner from the top of the ramp. At the end of the corridor is a door that opens into a room with seven cells off of it (two on each wall except the one you came through). There is a critter in each of these cells and if the critters are capable of opening doors, they will come out to get you. There will be four or five treasure piles in the middle of the floor and one in a room in the back-left cell. Opening the middle treasure pile will cause the entrance door to close (don't sweat it). Also in the back-left corner is a lever on the wall. I don't know what it does, but I always pull it, just to avoid coming back. The letters may be in one of the cells (this is the second quest object location).
Go back to the entrance. Again, with the entrance to your back:
Go through the door in front of you. When you get to the hole in the floor, pull the lever to get the elevator. Ride it down (there is a critter at the bottom, so jump off the elevator as soon as your head clears the ceiling of the room). Standing on the elevator and facing the lever, go through the door to your left and down to the end of this short corridor. There will be a door on your right and a secret door on your left. There is a critter behind the door on your right and this is the third quest object location (there are a couple of treasure piles behind the secret door). Go back and take the elevator up, continuing down the corridor as before.
When you pass the four-way intersection, there will be a secret door to your right. There is a critter behind it and, if it's capable of opening doors, it will try to get you. Look at the ceiling of the corridor and you will see an opening right above a pile of bones. Climb the wall or levitate through the opening. There is a treasure pile in front of you and this is the fourth quest object location. Drop back down to the corridor and go through the door at the end.
Ahead of you is an opening to the left with some tree trunks showing. Take that opening and follow it around (the door with the critter behind it is locked, so nothing will come out). There will be an opening in the ceiling and one in the floor, just past it. Levitate up through the opening and keep going in your original direction (there will be a door in front of you). There is a critter in the room behind this door that will try to come out to get you. Go around the corner and you'll see a door to your right. There is a critter behind this door that wants to eat you. Go around the next corner and you will see a pit with a skull on the wall. Don't drop down into the pit unless you want to have all of your magica sucked out of you (there's a critter in the pit, but it can't get you unless you jump into the pit). Click on the skull and it will move. Now go back to the hole and drop back down.
Drop or levitate through the hole in the floor and you will find yourself on top of an altar on a raised platform. There will be a critter off to the side and three doors in front of you. If the critter can fly, it will come get you. If it can shoot arrows, it will. There are a couple of critters at the bottom of the platform. You can go kill them if you want. Levitate (or jump if your skill is high enough) or climb to the wide ledge where the critter was/is and dispose of it. Go through either of the two doors in the back wall and you will be in a room with eight doors (all locked) and a four-armed statue. Clicking on the statue will open the six doors that have critters behind them. The best practice is to use your bow on them before clicking on the statue. In the back-right corner is a cell that has a secret door in the back. This leads to a small room with 2 treasure piles and is the fifth quest object location. Go back up the hole and back to the opening above the pile of bones (the fourth quest object location).
At the back of this short corridor is a shaft leading up. Climb or levitate up this shaft. You will enter a room with a torture device, two doors and a treasure pile. Behind one of the two doors is a small room. This is the sixth quest object location and it also has a treasure pile.
Open the other door and you will see a corridor with a pit. Jump the pit and go through the door at the corner. There is a critter at the top of the ramp in front of you. Go past the T-intersection to the door at the bottom of the ramp. On my system this door is very flaky and I can't open it. But the critter(s) on the other side usually can. In the closet in this room is the seventh quest object location. Go back to the T-intersection you passed earlier and turn right.
Go through the door at the end of the corridor and turn left. Go around the corner and up the ramp (there will be a critter near the top). Go past the T-intersection to the door at the end. There is a large room with two critters in it. One will be near the door and the other will be near the bottom of the ramp. There is also a door at the bottom of the ramp. Go through it and you will see an open trapdoor (remember that skull you clicked? It opened the trapdoor). Drop or levitate down (use caution here because there are a couple of critters at the bottom and it's very easy to land on top of one or both of them). At the bottom you will see a door that opens into a small room. This is the eighth and last quest object location (and the most probable location of the letters). There are also two or three treasure piles in here.
If you have not found the letters, you have a bug and need to follow the directions for dealing with missing quest objects in the Questing section.
To get back out (assuming you did not anchor a "Recall" somewhere), go back to the door at the corner that opened into the corridor with the pit (the one you jumped over). There is a steep ramp going down (and there may or may not be critters at the bottom, depending on whether you disposed of them earlier). At the T-intersection at the bottom of the ramp, turn right, go through the secret door to your right and out the door on the other side of the room (there may or may not be a critter in the room, depending on what you did earlier). Turn left as you go out the door and go straight until you get to the entrance.
Once you return the letters to Aubk-i, she will "tut-tut" about the orcs and tell you that Lysandus had a mistress. She will also give you a pat on the head and something for your troubles. This will probably be the last time she will talk to you because I just can't get her to generate quests other than these two.