In my opinion, while I personally think typing is fine, the context menus could seriously help newer players get into the game and aren't really detrimental at all to gameplay.
Here's the problem. Many client end points in server client relationship use standardized messages for all pre-determined strings/text. So let's say an NPC is supposed to say "Hello sir". Why would I send a packet with "Hello sir" as a string when I can simply send it a very tiny integer. The client can then look up that integer in the installed client files and discover that it is "Hello sir", then add that to the right place. It greatly reduces network traffic, which was especially important in 1998. Additionally, what if I don't speak English? Wouldn't it be easier for me to just have the Chinese client installed and when the client gets the small integer in a packet it can give me the message "先生你好!" instead of sending that rather large unicode string over the network? I could just update all these client side messages and have the whole game available in any language by the client, without any additional server work or putting restrictions on string length. Well UO handles these in something it called Client Location Message (cliloc). All the context menus are also handles through this method. If I just create UO server with Runuo I can absolutely turn on context messages (actually they are on by default). But UOR is far from the default Runuo configuration. Every single message that players make and npcs respond to, and every context message or npc text is a cliloc message, EXCEPT for those added by Telamon to UOR. The result would be sometimes there is a context menu, and sometimes there is not. Wouldn't that inconsistency be much more problem for new player than simply having no menus at all? I think so. Getting all context menus to work would require either a complete overhaul of how those messages are delivered to the client, patching the client, or a huge undertaking to adapt current messages to unused cliloc messages from later periods of UO still on the client files. It would absolutely not be worth doing "correctly".