It looks like the mod is not installed properly. I had a complicated discussion with another member here. I will do the arrogant thing and quote myself to help explain.
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As for folders, I will do my best not to confuse and I will try to be as brief as possible (which will be tough). Sometimes when you unzip a folder inside of the "Data Files" folder inside of the "Morrowind" folder, it creates a second "Data Files" folder, which inside of the original "Data Files" folder. I know that sounds confusing, but the address would like this: C:\Program Files\Bethesda Softworks\Morrowind\Data Files\Data Files. If you do have this second Data Files folder, just take the contents out of it and put it in the correct folder (i.e. Textures into Textures, Meshes into Meshes, etc. (make sure to keep subfolders inside these folders since they may be required as part of the file path for the mod.)) in the regular Data Files folder. Occasionally, a mod will create a second "Morrowind" folder; the solution is to use the same technique.
Of course, other times, a duplicate Data Files folder is not created, but rather a subfolder which needs its contents manually moved the correct folder.
Usually, these type of problems occur with incorrect installation.