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1/ I'm not sure if Morrowind allows for 'randomly generated' quest locations in the same way Skyrim's 'radiant quest' system does. I think you'd probably just have to set up specific quests in order. I'm not sure if Morrowind's engine and such would allow for having the items not exist before the relevant quest started (e.g. if you wanted to have one of the locations be the Daedric place on the path up to Ghostgate from near Caldera, I don't know if you could have the items only spawn there after the quest for that specific location was initiated).
2/ Re how to finish the quest, most 'fetch quests' in Morrowind end by what would seem to be a fairly simple dialogue (click on the relevant topic, questgiver asks if you have the thing yet, yes/no options appear.) I would imagine you'd be better off ending the quest that way rather than through selling the questgiver the item in the Barter window, if that's what you meant.
3/ I would think the way to make the dealer only interested in 'his' goods rather than any generic moon sugar/skooma would be to have them be unique items, i.e. 'Top Quality Skooma' as a general item for all the quests, or 'Balmora Blue', 'Ald'ruhn Asthma-Inducer' (hey, I don't claim to be good at naming stuff...) or whatever for regional names for the 'product' retrieved from various locations. Of course, he'd probably also be happy enough to buy the regular stuff (mainly because if you want him to have Barter options I'm not sure if you'd be able to give him a unique variation on the usual 'I'm not dealing with you if you've got that illegal stuff in your pockets' that was more 'hey, I'm dealing in quality goods here, get that cheap crap out of my sight') at a bog standard price.
AFAIK there's no existing mod that does quite this, but you might like some of the mods on this discussion https://www.reddit.com/r/Morrowind/comments/3drut8/playing_a_hardcore_skooma_addict/
I have actually started to make this simple mod myself, looking like I'll have to make unique items, as you said, and just create lots of quests but that's not a problem.
Throw some more names out, including a name for my smuggler Khajiit who is the NPC I'll use, I like them.
EDIT: That thread had some nice mods in there, might give those a go too.
EDIT2: Named the NPC. Planned out a 20+ quest mod.