My system plays at around 40 FPS with every single slider on max at 1600*1200, I believe your CPU is what's stopping you, oblivion is a very CPU intensive game according to many sources and through my own experiences.
Yeah I found the problem (It didn't always have crappy framerate). I remembered I'd stuffed around with stuff in the nView driver things.. put them back to default and I'm getting very playable framerates again.