What an impressive game. From the little I saw yesterday, it looked like it had everything Morrowind had, but with about 95% of all Morrowind's problems fixed, along with several completely new things.
Once again, the game is set in an enormous, meticulously detailed, totally open world. That may not seem impressive to some of you, especially those who play MMORPGs, but what sets the Elder Scrolls games apart is that every inch of the world is traversable. See a mountain in the distance? You can climb it. A forest across a river? You can swim across the river and explore it. There are no invisible barriers or isolated sectors of land as there are in Guild Wars. The landscape isn't as bland as in Lineage II (speaking of Lineage II, feast your eyes on this. Why can't I meet girls like that?).
And the landscape is even more beautiful in Oblivion than it was in Morrowind. There're realistic looking trees and grass that sway with the wind. Realistic, dynamic lighting effects.
Perhaps one of the biggest improvements over Morrowind, though, is the AI. The world is filled with people that can literally think for themselves. Instead of characters idly standing about town, or moving on rigid, scripted paths, characters in the towns all have motivations. Characters will, if upon finding themselves hungry, look for food and eat it. They'll hunt for deer in the forest. They may try to steal food, and they might get caught--if one of the guard NPCs sees them--and get taken to prison. Or they might even hatch a plan to frame someone else.
Stable boys can be seen tending to horses--or watching you if you go into the stables without any apparent reason. Monsters will hide and stalk you in the forests, instead of bounding heedlessly towards you.
The AI seems to be more sophisticated than that of The Sims, though I bring that game up because the character creation mode for Oblivion is very similar to The Sims. Instead of a few head models to choose from, as in Morrowind, you here have a column of sliders that can determine the shapes of individual facial features, as well as age and colouration.
I only hope Tim let's me play at some point, 'cause there's no way my system can run it...