We can arguably agree that a moderate number of mods is a nice way to improve the game. I thought the game was fine myself but still wanted to try out some mods. Oblivion has AMASING modding capacity.
Having a LIFE in the "real world" myself, I didnt have much time to try and test each mod indivitually. So I started with recommendations from
http://www.uesp.net/wiki/Oblivion:Must_Have_Modshttp://users.adelphia.net/~amito/Oblivion/OB-mods.htm Then I have to disagree with these people who make very radical changes in the game. My objective is to slightly improve my fun going through the game. My impression on some big mods is to enhence experience of LVL 25+ characters, and I fear it neglects new players. Some people seem to really dislike the game so I'm careful when they recommend a mod...
====the mods I ruled out=====
-Attack & Hide Mod lessens the radar ability of NPCs and creatures after you shoot an arrow at them
* I heard NPC AI is affected, eg they can attack a nearby innocent NPC.
-Extreme realism mods: Hunger, Sleep, Darker dungeons, Daytime...
*Ok too much reality there. I didnt want a Tomagochi. If you want pure reality turn off your pc! It improved the graphics quality for me too!
-Grass without tiling. *Removes details in the end. Tiling/Detail balance is acheived in most LOD texture packs.
-Magistrate Eyes: *Blue Eyes like the sky..too much. Your NPCs will all have those cheap colored contact lenses and theres no dialogue to point out to them its not fashionable anymore...
-Borderless Cyrodiil: *a personal choice. I dont want to waste time off-map. I got bored of it when playing the original DOOM. Besides its against the law to cross borders without reporting to a duty station or border officer.
=====the mods I like======
Here is the full list of mods I'm using. This improves my gaming experience by 300%! I don't like mods that boosts my equipment, horse, ect... So these are my picks:
-AFLevelMod.esp (customisable, remodeled levelling system. After install, when you lvl up it will ask you a series of questions and reajust your stats to what you really deserve! I was scared first but its better than the default)
-ChaseCameraMod (stabilises 3rd person and 1st person view so you dont need vomit bags anymore)
-DEG_harvest (flora changes apparence nicely after harvested)
-DLCFroscrag.esp (official mod)
-DLCHorseArmor (official mod)
-DLCHorseArmor-HC2.2 (remodding of official mod, improved and in-game-customised horse behavior through a book)
-DLCOrrery (official mod with new quest.. didnt try yet)
-FathisFix (Fix Fathis the NPC pattern to sleep in correct house and not get stuck)
-HorseCommands.esp (Give commands to your horse with spell)
-IWR-Lights (Visual - improved house lighting)
-IWR-Shutters (Visual - improved exterior house window)
-IWR-Windows (Visual - external daylight from windows. wow)
-Magistrate Eyes (I enable Player file only, not NPC. If you want more choices)
-mythsandlegends (a few more NPCs and small quests/lore)
(Visual - improvements of climate immersion)
-Natural_Habitat_by_Max_Tael
-Natural_Vegetation_by_Max_Tael
-Natural_Water_by_Max_Tael
-Natural_Weather_by_Max_Tael (nicely improved weather)
-Natural_Weather_HDR_by_Max_Tael (more intense raining and stuff - choose only 1 of the last 2)
-No more annoying messages (such as "your horse is stabled" that interrupt gameplay)
-Oblivion.esm (This is my favorite one lol)
-PersuationOverhaul (Replaces mini-game of persuation. More realism towards the personality skill. Some NPC just cannot be charmed by a low-personality players unless lucky in the conversation. Reintegrates the Role Playing back in the Game. There is still 4 choices to be given the player. Your skill and attributes determine the chances talking will improve the disposition of the NPC. The concept is perfect for me, but I would like an improvement on the interface: there is a delay until you see the updated NPC disposition after one "talk")
-Respawn_Month
-Short Grass V2 (Performance. Grass no longer hides your player

)
-Slof's Horses Base (Slightly better looking horses, removes their
-Slof's Horses Essential (working with DLCHorsearmor)
-tag_naturalwildlife (Animals species have their respective behavior - . Animals are naturally shy so most of them wont attack you. However, the player has a small chance to encounter very strong agressive monsters in the wild.)
-Topal Island: Adds your nice home on a small island in the South
-Visually Enchanted 2.1.esp (Better looking glow of enchantements - no more E1970's fluo!
-_cities_alive_at_night.esp (a bit more lights visible from outside cities at night - wow)
Please share your own objectives in modding and installed mods that work for you!