harder than it should be, and it just does not fit with the enormity of the game and its genre = PROBLEMS
Also in regard to visual items in the inventory, it is funny how their is a button to get rid of the scroll bars to get a CLEARER view of the item. Yeah...like that is needed with its ginormous size already.
Well obviously we need to be able to see the awesome minecraft-esque textures on the bottom of our healing potion!

It would have been cool if for example, said potion in 'giant' view actually had a list of ingredients you could zoom in on, like a little easter egg to up your alchemy, or unique weapons/jewelry had a maker's mark or reference to lore hidden on them. You could actually enhance gameplay, say inspecting a certain sword resulted in finding a rolled-up map in the hilt, marking a quest location. Of course that would be in the realm of next-gen technology, incredible games like er, Silent Hill 2. Having said that we could still have small-real-estate items and zoom right up to giant sized ones without clunking up the interface.
Anyway, I believe someone already mentioned sorting inventory, in the spirit of being constructive I'd say if we're really stuck with a crappy list-based menu system then a 'sort' at the top would be great. I think in addition to equipped items always being at the top, we should be able to at least sort by A-Z, Weight, Type and Value. I think these four would be the most useful from a gameplay point of view. A-Z is obvious, Weight would be useful for one of the million times you'll get overencumbered, Value could also work for this as well as seeing which items to sell first, and Type obviously groups items into their relevant categories, IE weapons grouped into Axes, Swords, etc. or possibly ranged, 1h, 2h.
(I suspect the reason this doesn't exist is because with the tiny space they've given menus onscreen, some idiot in the design dept went OH NOES THAT WOULD BE TOO SMALL TO FIT ON POOR 360 KID'S 1080p 42" TELLY!.. honestly, if they could I suspect they'd have just done the menus in braille.)
On a side note I also think shields should be equipped as a weapon as opposed to apparel, it makes very little sense since a shield is less of a fashion accessory than a combat-based item equipped to one of your arms. It would also make it easier to see a shield/sword combo equipped together in one menu list.
For equips it would be good if firstly, as others have mentioned, you can 'favourite' items OR hotkey/favourite from ANY place in the item menu with one click - it's simple; hotkeying an item auto-adds it to the favourites menu too. That way you get the best of both worlds.
While selecting weapons/shields/magic to hotkey, you could also be given a prompt when selecting hotkeys that already had something assigned. I'm aware this is against the rule of 'less clicks' but I believe it would add more function than form. The idea is that when you select a hotkey, say "4", part of the vast unused real-estate lists which items (if any) are currently mapped to that hotkey. The beauty of this would be that if you had magic hotkeyed to your right hand, and you selected a sword, you would know where the magic was equipped and then be asked "Where do you want to equip the sword?" With answers of LEFT, RIGHT, CLEAR BOTH, or CANCEL. If you wanted to keep just a single thing in that hotkey, selecting it would still do the normal Skyrim thing and replace whatever was in your hand while leaving the off-hand alone. That way your weapon hotkeys can all instantly equip a combination of dual wielded nastiness, or merely switch one hand if you so desired.
Oh, and finally, when looking at weapons, and especially armour, that vast screen real-estate could most definitely be used as a space for detailed comparison with your current equip, as opposed to just the little ^ sign to indicate that one of it's base stats is better than your current item. You could also have hotkeys still work within that menu, so while looking at the new battleaxe you just picked up and realising you're comparing it to your 1h sword, you could hit the hotkey that switched from your sword to axe and you could compare the stats for relevant weapons at the touch of a button, without ever leaving the screen.