Yeah, ever play dungeon siege? That game seems like a perfect game as an MMO, but they made it for LAN so only about five or six people could be in one game at the same time.
Morrowind had a multiplayer mod.. Though it did suck..
I just briefly scanned through this but here is the answer to your question... Not sure why no one had mentioned this... Or maybe they did but I missed it...
You should get it for the PC, instead. Oblivion without Francesco's leveled creatures/items mod is like running on a treadmill that's going a bit too fast for you, unless you have a one of a few class builds. It was so bad that I stopped playing because the only way to advance was use of a series of spells to keep me invisible constantly (ie. heal+invisibility,detect creature+invisibility,summon+invisibility), and that was boring.
I don't like playing games on the PC. For me, consoles are there for games, and the PC is there for the internet, and weird and wonderful programs that do strange little things.