Great but avoid playing the GOTY edition on the PS3!
Gorgeous graphics. The landscapes, the buildings (in particular places and cities except the Imperial City), the water and weather effects. Sometimes it's enjoyable just to appreciate the views, as you would in real life.
Huge world. The world is really big. There are many places to go and explore. Lots of caves, cities, houses, ruins, temples, etc. You will spend hundreds of hours to explore completely the map.
Several quests. There are tons of side quests and many important quests as well. There is a good balance of how the quests are set, because it's not obvious which quest is the "main quest", "important quest" or "side quest".
Excellent soundtracks. There are a few ambient songs, but even if they repeat after many hours of gameplay, they are sill enjoyable and well written.
Relaxing gameplay. Considering the combination of the factors above, the gameplay is excellent overall.
Bugs, glitches and freeze errors during gameplay. For example, freezing without apparent reasons at any point in the game. I estimated that freezings happened 20-30 times after 400+ hours of play. The most serious problem I experienced was bugs and freezing during the saving/loading, which was itself very frustrating for obvious reasons.
To avoid such bad surprises, I had to save often. Only loading a previous save state could solve a saving/loading problem at later stage. Some glitches are notable. For example, the rain drops passing through solid roofs were ugly. The player can also get stuck in some complex terrains, in particular in the Shivering Isles.
I also experienced bugs with a few few quests, which I had to give up to avoid problems (such as the saving/loading one for some reason). It's also well known a problem with the Vampire quest (which I avoided to finish the game).
Unfortunately, as of december 2010, several of these problems CANNOT be solved in any way in the PS3 port of the GOTY edition. Watch out!
The Bottom Line
Apart from the bugs and alike, this is an excellent game (including its two main expansions). Many many hours of fun and exploration are guaranteed.
However, recall this game should be played in another platform than the PS3 if you want to avoid some frustrations with the problems I described above.