Does it really matter? It's the usual corporate intrigues/power struggle/backstabbing/whatever. Just for some reason leaked into public view instead of being behind the scenes like it's normally done, probably because someone is stupid.
I don't mind them raising minimum requirements if they actually use features of newer hardware (cough unlike Windows 11 cough), but requiring upscaling is never a good sign. It's just a cost-cutting strategy that allows them to spend even less money on optimization work while reallocating that money to marketing budget or exec bonuses or whatever, at the cost of visual fidelity. It doesn't benefit customers in any way, quite the opposite.
Morrowind remaster won't sell. It's one of those "hybrid" RPGs similar to KOTOR games - it has a gameplay elements of isometric RPGs: RNG combat, very few voiced dialogs - while looking like 3D action RPG. This just won't work for modern gamers. Its theoretical devs would need to either turn it into isometric CRPG or completely rework its gameplay to make modern action RPG out of it (as well as do it in the new engine to improve graphics and everything else). Both choices mean a complete remake, not remaster.
I don't know whether this leak means "true" remake of Oblivion, but that seems unlikely. Oblivion is relatively modern and you can definitely remaster it for new hardware without complete rebuilding.
I played it by myself and it was fine up until the last fight in Lucien's tomb (or whatever it's called) where you need to sit through 50 enemy turns before you are killed after barely making a few steps. I just enabled cheats and finished the game, all the good parts of it were before that anyway.