In the stock Oblivion, practically everybody you meet has some function in some quest. Where are all the regular Janes and Joes going about their day?
Some quality NPC mods are the answer. Making good non-player characters with proper working AI is a bit of an art form in Oblivion. Technically, you could make an NPC with a routine that changes to a different activity every hour for 365 days...a bit of a chore to make, but possible. Having complex AI routines also takes time in-game...so if you have the game set to the default Time Scale of x 30, many NPCs with complex routines barely if ever complete their AI packages. The day goes by too fast.
So if you add complex NPCs, I recommend a much lower Time Scale...x 10 or x 15 for example. This can be done in the console (set timescale to X) or with Cobl if you have that installed. Some hardcore types do x 1 Time Scale...really living a double life...lol. Leave Oblivion running, etc...perhaps crazy? Who can say?
Anyways...here's some good ones that work problem free on our rig to get you started.
There are many others, but these are simple and work as advertised. Mass AI is highly recommended if running NPC mods. The default number is only 20. Otherwise, you can set the number of NPCs allowed in a complex scene via the Construction Set. Our limit is set to 100 and does the trick in most situations. We did a half-ass count of the estimated NPC population in our Oblivion....about 5,000...not all in the same place at once, of course.
As many of you know, the Oblivion exterior world is plopped down in the middle of a vast area that goes completely unused. This mod changes that in the Leyawiin region.
Meant to work with Elsweyr, Knights & the Vile Lair...run them below in your load order. However, there is a bit of a landscape tear near Alabaster that there isn't a separate patch for as of yet. But not to worry...there's Land Magic (why aren't you using this??) that fixes ALL of your many-mod-soup's landscape issues. www.nexusmods.com/oblivion/mods/30519
There are no quests...just a whole lot of room...locations...creatures...etc. It's fully formed and pathed for AI.
These two mods are now my absolute 'must-haves' for my characters as they really do transform any fighter character so they look like they know what they are doing as well as taking a wider range of factors into account to determine a character's attack speed. And no more being offended by your character holding a two handed weapon like a baseball bat, - because that less than best animation is gone.
What has Reality (TM) done for you lately? Narcolepsy is not napping.