It fails because the entire rest of the game trivializes it. It then becomes an annoyance, like some leftover mechanic from a different game.
Give me a Fallout that works like The Long Dark and looting becomes meaningful. You can't fast travel, hunger/thirst/sleep is a constant worry, enemies are few, but very dangerous; everything is scarce and eventually you'll inevitably run out of resources. Then looting becomes meaningful. But then, that's another game entirely.
On The Long Dark, I usually choose a house to stash my stuff, but even when I know the path there is safe, the time I waste going back and forth is a strategical decision, because walking back and forth is, itself, hard on that game and, by itself, consumes resources that are always scarce.
Don't Starve functions almost the same way. You can take care of yourself very well in your base, but the further you go from it, the more costly the trip back is, and the longer you stay away from the base, the more chances that you are in significant danger (and wasting resources, since eating raw stuff is a lot more expensive than eating stuff you can cook with the stuff you have at your base).
Bethesda games are not survivor games; time is meaningless for one, few things acts as resources and even them are usually only scarce at the beggining of the game. You can go back to your home with a click and a loading screen at any time and the challenge is not staying alive, but surviving the next wave of enemies. In this context, deciding what to loot or not is not an interesting choice, because there is nothing that supports it. There is no aditional danger or risk involved in a trip back to town; there is no waste of resources or precious in-game time. Again, stuff on the ground is pretty much already yours, they are just restricted behind a time sink. And time sink challenges you to what? Not have a real life job or dentist appointment?