If you were lucky to amass enough gold, a horse or wagon is a good early purchase. A wagon is useful because you can store a lot more treasure and equipment and a horse enables you to travel around quickly without draining your stamina. It's a big horse and when riding it you seem to be level with the top of the single storey buildings. While in town, if your reputation suits, you can join one or more of the guilds. The most obvious are fighter and mage guilds but there are somewhat 'darker' ones available.
Taverns provide resting spots.
If you rest outside the guards will attempt to arrest you but there is a loiter option for passing time. There are also weapons shops, gem stores and book stores. The books in Daggerfall can actually be read and give a deeper background to the game world. The conversation options with NPCs generally fall into the where is, who are you category. You choose appropriate questions from menus that are divided into categories.