The Elder Scrolls 4: Oblivion is what I'd call a bit of a mixed bag. A mixed bag of skittles and dog shit. For whatever reason I felt like doing a rundown of the things Oblivion did wrong, as well as a few of the things it did right. If you haven't played it or are interested in what I have to say, shtaw awhile and lishten.
What they did wrong:
Combat:
Enemies take plenty of damage, people don't react to being hit, and attacking someone with a sword feels (and sounds) about the same as slashing at a rock. These might not be problematic in a traditional RPG, but Oblivion's controls aren't suited for this type of gameplay. It plays more like an action game. All your basic combat functions (attack, block, cast spell) are mapped to their own individual buttons, and react pretty immediately. Since each attack must be performed manually, every fight winds up feeling like a chore as you slowly wear down your opponent's health bar.
Then they drink a potion.
Encounters are typically one on one, and in that kind of scenario the AI needs to be crafty and unpredictable to keep things fresh and challenging, but unfortunately those are qualities the NPC's of Oblivion lack. If you follow the simple pattern of blocking, then striking twice while they're recoiling, you'll never lose a fight. Archers need simply run backwards while they shoot and never worry about taking a hit. Mages... well, we'll get to that later.
In short, combat is repetitive and dull, and not well suited to the control scheme.
Leveling Up and Scaling Difficulty:
As you level up in an RPG, your stats increase, you gain access to new and better equipment and, as a result of these, you can travel to new areas of the world that you were too weak to visit before. In Oblivion, you can use any armour and/or weapon from the get-go, and the danger levels of different parts of the world are uniform throughout. The wimpy bandits you fight right outside the tutorial area are the same as the bandits you'll see from Cheydenhall to Anvil. The only thing stopping you from exploring the rest of the world right off the bat is the travel time and, of course, there's always fast travel. A player can easily see all there really is to see before they even hit level five
The issue here is that if you can explore the whole of the map right at the start there's no incentive to level up so you can see new areas. If you want you can instantly go to any major town and travel around from there.
The scaling difficulty just compounds the problem. You don't get any sense that your character is improving when everyone still takes just as long (or longer) to kill.
Economy:
Money is easy to make, given all the loot you'll be picking up, but it's not really worth keeping around unless you're a mage. See, while your foes will scale alongside you, the shops won't, or at least not nearly as fast. Bandits will be wearing deadric gear by the time the armour store even has dwarven, so it's usually best to just venture to the nearest ayleid ruin and see what you can scavenge.
The World, an Those Who Inhabit it:
Oblivion has the stink of the level editor about it; that is to say, you'll see a lot of repeat scenery. It looks generated rather than crafted. But it goes beyond that. Despite Bethesda's valiant attempts at making it otherwise by giving everyone a different name and face and letting you talk to them all, NPC's feel copy pasted and interchangeable, and their low numbers and lack of any apparent emotion makes towns feel deserted, barren and lifeless.
Balance:
Want a few tips on how to make a good Oblivion character?
Step one) Be a magic(ka) class with skill in destruction.
Step two) Win the game.
You know how in most games, every class has it's advantages and disadvantages? How mages start out kinda crappy and have to rely on potions all the time, but it's worth it because eventually you'll be raining fire from the sky onto your hapless victims? Oblivion starts at the end of that curve, and from there you can only get better. The only disadvantage I can think of is that being a mage is fairly expensive. You need money to buy and make spells, as well as buying potions and/or the alchemical materials requisite to make them yourself. But considering all the loot you'll be taking off of the enemies you just massacred, it's kind of a non-issue
What they did right:
Quests:
Oblivion has some of the most interesting, varied quests I've seen in a game. Not to say they're all varied and interesting, but more than enough of them are to offset the more generic ones. You'll do anything from systematically killing the guests of a party like the villain in a slasher flick, to navigating the twisted corridors of another man's dreams. As bog standard as TES4's setting and main story may be, the side quests really set it apart.
Interactivity:
Just about any item you see in Oblivion, you can pick up. Any building you see, you can enter. Any NPC you can talk to. It's a freedom few games afford, and it feels good.
Shivering Isles:
This is probably one of the greatest expansions you'll ever see. Shivering Isles adds a whole new world for the player to explore (that is to say, it adds the Shivering Isles,) in a different dimension, that of the mad god Sheogorath. And the theme of madness runs deep in SI. Everything (and everyone) there is dripping with it.
If there's something you'd like to add to either side of the list, or if you take issue with something mentioned above, feel free to mention it.
Oh, and by the way...
Seriously, CAPTCHA? What the hell is that supposed to be?
What they did wrong:
Combat:

Enemies take plenty of damage, people don't react to being hit, and attacking someone with a sword feels (and sounds) about the same as slashing at a rock. These might not be problematic in a traditional RPG, but Oblivion's controls aren't suited for this type of gameplay. It plays more like an action game. All your basic combat functions (attack, block, cast spell) are mapped to their own individual buttons, and react pretty immediately. Since each attack must be performed manually, every fight winds up feeling like a chore as you slowly wear down your opponent's health bar.
Then they drink a potion.
Encounters are typically one on one, and in that kind of scenario the AI needs to be crafty and unpredictable to keep things fresh and challenging, but unfortunately those are qualities the NPC's of Oblivion lack. If you follow the simple pattern of blocking, then striking twice while they're recoiling, you'll never lose a fight. Archers need simply run backwards while they shoot and never worry about taking a hit. Mages... well, we'll get to that later.
In short, combat is repetitive and dull, and not well suited to the control scheme.
Leveling Up and Scaling Difficulty:
As you level up in an RPG, your stats increase, you gain access to new and better equipment and, as a result of these, you can travel to new areas of the world that you were too weak to visit before. In Oblivion, you can use any armour and/or weapon from the get-go, and the danger levels of different parts of the world are uniform throughout. The wimpy bandits you fight right outside the tutorial area are the same as the bandits you'll see from Cheydenhall to Anvil. The only thing stopping you from exploring the rest of the world right off the bat is the travel time and, of course, there's always fast travel. A player can easily see all there really is to see before they even hit level five
The issue here is that if you can explore the whole of the map right at the start there's no incentive to level up so you can see new areas. If you want you can instantly go to any major town and travel around from there.
The scaling difficulty just compounds the problem. You don't get any sense that your character is improving when everyone still takes just as long (or longer) to kill.

Economy:
Money is easy to make, given all the loot you'll be picking up, but it's not really worth keeping around unless you're a mage. See, while your foes will scale alongside you, the shops won't, or at least not nearly as fast. Bandits will be wearing deadric gear by the time the armour store even has dwarven, so it's usually best to just venture to the nearest ayleid ruin and see what you can scavenge.
The World, an Those Who Inhabit it:

Oblivion has the stink of the level editor about it; that is to say, you'll see a lot of repeat scenery. It looks generated rather than crafted. But it goes beyond that. Despite Bethesda's valiant attempts at making it otherwise by giving everyone a different name and face and letting you talk to them all, NPC's feel copy pasted and interchangeable, and their low numbers and lack of any apparent emotion makes towns feel deserted, barren and lifeless.
Balance:
Want a few tips on how to make a good Oblivion character?
Step one) Be a magic(ka) class with skill in destruction.
Step two) Win the game.
You know how in most games, every class has it's advantages and disadvantages? How mages start out kinda crappy and have to rely on potions all the time, but it's worth it because eventually you'll be raining fire from the sky onto your hapless victims? Oblivion starts at the end of that curve, and from there you can only get better. The only disadvantage I can think of is that being a mage is fairly expensive. You need money to buy and make spells, as well as buying potions and/or the alchemical materials requisite to make them yourself. But considering all the loot you'll be taking off of the enemies you just massacred, it's kind of a non-issue
What they did right:
Quests:
Oblivion has some of the most interesting, varied quests I've seen in a game. Not to say they're all varied and interesting, but more than enough of them are to offset the more generic ones. You'll do anything from systematically killing the guests of a party like the villain in a slasher flick, to navigating the twisted corridors of another man's dreams. As bog standard as TES4's setting and main story may be, the side quests really set it apart.
Interactivity:
Just about any item you see in Oblivion, you can pick up. Any building you see, you can enter. Any NPC you can talk to. It's a freedom few games afford, and it feels good.
Shivering Isles:

This is probably one of the greatest expansions you'll ever see. Shivering Isles adds a whole new world for the player to explore (that is to say, it adds the Shivering Isles,) in a different dimension, that of the mad god Sheogorath. And the theme of madness runs deep in SI. Everything (and everyone) there is dripping with it.
If there's something you'd like to add to either side of the list, or if you take issue with something mentioned above, feel free to mention it.
Oh, and by the way...

Seriously, CAPTCHA? What the hell is that supposed to be?