Is it worth having Better Cities ?
Is it compatible with city quests ?
Is it also compatible with FCOM ?

Thanks.

1. Oh yes, it's one of the best mods for me. I felt like I needed some refreshment from vanilla cities where I knew everyone and everything so I gave it a try and now I can't imagine playing my game without this mod. Not only it adds new buildings, shops, taverns, bath houses, graveyards, ..... it also adds ton of NPCs with their own complex schedules. But not all cities are drastically changed, e.g. Imperial city is largely improved, you now have underground tunnels connecting various districts, many merhcants who now sell some clothes which were hard to get in vanilla game, new quests (Gold horse courier)... while some cities like Cheydinhal are mostly visually improved and there aren't other significant changes apart from adding new residents and some other buildings.

2. What quests are you referring to? It doesn't break any vanilla quests if you mean that.

3. Yes.

EDIT:
If you decide to install Better cities, I'd recommend AWLS mod - Animated windoe lightning system too which fits perfectly with BC.

If your PC can handle Better Cities, I would consider it a must have mod for Oblivion.
It works with FCOM(.99 definitely,I have not tried running it alongside FCOM 1.0) and many other mods/compilations through patches. It adds a lot to the cities to make them feel more alive and vibrant.

Add me to the list of folks who think Better Cities is a must-have for any modded game. It is worth it to get the changes to the Imperial City Market District alone. It does a phenomenal job with all the towns. And definitely grab the Animated Window mod that Lopov87 mentions. It's also a must have in my modded games.

Ok, thanks guys.

Use the http://www.gamesas.com/forum/25-oblivion-mods/ for these kind of questions, thanks.