Oblivion failed for me based on one glaring aspect. The leveling system. I hated how the entire world leveled with you making pretty much any character progression outside of the most metagamey bullshit crappy. Oh, and character progression in that game also sucked because of said metagamey aspects.
'There's a mod for that' really shouldn't be an excuse for poor design in the first place, and pretty much every one of Bethesda's titles since Oblivion has suffered from this.
It's why I can't legitimately justify buying a new TES or Fallout game developed by Bethesda themselves day one until they release all their DLC and the modding community has had their way with the game to fix all the half-developed systems. Fallout: New Vegas was a better game than anything Bethesda put out right out of the box, bugginess notwithstanding and most of the DLC for it was fantastic, especially OWB.