Excuse me, but you are very obviously missing the point. Geckoman said that it is impossible to have interiors without loading screens because "you would have to load it all into memory". I corrected him by saying that you don't have to load it all into memory, you can stream it from media. I used those examples to demonstrate the CONCEPT of disc streaming.
Besides, I've seen plenty of mods that have a lot of objects, NPCs, etc. in the same worldspace as the main map, and my PC has no problem streaming them.
And explain to me why the fact that the games were made on consoles in any way invalidates what I said? Sounds to me like you have problems with people even mentioning the existence of console games. You REEK of childish PC elitist.
Give me your PC specs, is it more powerful than an xbox? There you go. Tell you what, Find a 360 copy of Oblivion, go to Bruma, and steal every havok physic'ed item you can find that isn't in a container. Every plate, cup, and book. Walk outside into the center of Bruma, and drop it all at once. After it freezes, realize that what you just did ISN'T including all the items without havok physics, any NPCs that are inside, and all the lights that are indoors. All of which would also have to be rendered as well. Also realize that the 360 detail is in the low to medium settings of what you can do in Vanilla Oblivion on a PC. You will have your answer. This isn't PC elitism, it is fact. Just deal with the fact that an Xbox, with all of it's 512 mb of RAM and gpu 10 mb of eDRAM, combined with a triple core processor just cannot render all of that at once.
In the games mentioned, disc streaming works because there is such a fraction of stuff to load, even with the high detail put into environments. The AI is simplistic at best, often only being able to tell friend from foe, and decide whether to act normal, fight, or run in preset patterns (Oblivion had multiple AI routines and combat styles, sometimes multiple for base enemies like Bandits. There are few to no objects with real physics and most parts of items fade in seconds after being destroyed, or just fall through the ground entirely. In GTA, the streets get emptier (not too much, but noticeably) if you get a wanted level because the game has to compensate for the additional cop cars and probability of lots of gunfire and explosions. Same with RDR, JC2, RF:G, and any other game with disc streaming.
You are correct, it can work in theory, but until we get DVD read speeds at 60x or higher on consoles it won't happen on a game with this much stuff.