Why would I need to see what weapon I'm holding to know what I have equipped? I'm not an idiot. I know what I have equipped at all times when I'm playing a game.
If you study interface design (both physical and digital) and psychology, you'll discover that feedback (tactile, auditory, visual) is very important to keep people from getting confused and/or keep them fully aware of their situation.
And honestly, between the dual-hand system and all the spells/weapons/shields/whatever & hotkeys not always throwing the thing you activate into the correct hand.... yeah, there needs to be some kind of indication on the screen of what you actually have equipped. It's reasonably common to go into combat mode, and have your two hands not holding what you expect them to. Now, these things could be shown by the UI, perhaps in little circles in the corner of the screen (like the weapon and spell indicators in Oblivion), but then the "immershun" crowd would complain. Having your hands (and what's equipped in them) be visible on screen is the "less intrusive" method of providing this feedback.