Mount and Blade is incredibly original and fun, but it is lacking in a few areas.
You can harass trading caravans, kill looters and bandits, or become a mercenary company for one of the factions. Eventually you can even pledge an oath of fealty to one of the kings and become his vassal. You will be able to draw income from your little plot of land, and then have the opportunity to take more castles in the name of your king with the chance that it will be awarded to you to earn money from.
You don't have to do any of this or you can do all of it. It's your choice how you want to play.
The main part of the fun is the combat. You are the leader of your troops and can play from either a first or third person perspective. You can give rudimentary orders to your troops like hold ground, charge, or follow me. You can give individual orders to different troop types as well (infantry stand ground, cavalry charge, etc.) The combat is a blast, especially because it is one of the only games to incorporate mounted combat. It is a blast to charge through enemy ranks on an armored horse, slashing down at the filthy peasants and wading through a torrent of bloood!!! ARRRGGHH!! Err sorry.
That being said, the game is not without flaws. Siege combat is more polished now but is still a bit wonky. In sieges you get one ladder/siege tower to assault the walls and that it. It sometimes reminds me of that scene in Pink Floyd's "The Wall" where the children are walking off a conveyor belt into the giant meat grinder.
Secondly, once you reach around mid game or so, everything is just too easy. There is no real challenge. Even the parties of other lords will only be able to best you with at least DOUBLE the men you have if not more like needing the odds to be 3 to 1 in their favor. The problem is by then you have elite troops and most of the time lords only have mid level troops at best. Also once you get to this point the bandits and other lesser threats are no longer even worth your time. They are no challenge at all, and not to mention the loot they drop is not worth the fight either. This is a HUGE minus for me, I don't get any fun out of it with no challenge. The siege battles are not easy but they aren't interesting enough to make up for the incredibly easy combat.
Lastly a more minor gripe is the raw power of the more worthwhile horses in the game. Once you are able to afford a warhorse, you can charge through enemy infantry like they were cardboard cutouts. The only time your horse will be stopped is when you are going very slow when running into a foe. At full gallop it seems like nothing can stop you. You will only be stopped if you run into a crowd of enemies ten deep or if there are friendly troops mixed into a crowd, since you will always be stopped cold by your own troops instead of running them over. This means that if you maintain momentum and have even just a modicum of skill you can feel indestructible.
Add in the facts that there are no voiceovers, no story to speak of, and somewhat dated graphics, which all detract from my overall score, but not much.
Fans of the game who have been playing the betas for a long time will tell you to turn up the difficulty or try some mods. Well I play on the hardest difficulty and it is not that hard. And the mods do help of course, but a game should not just be able to fall back on mods. I like vanilla mount and blade, I don't want to play mods. The game would just be better overall if it were more challenging.
In the end this is game is great fun, big points for originality and fun factor, but you may grow bored quickly if you are looking for a real challenge.