Your not an idiot, you just have a life. I'll try and put it VERY simply (about everything in this post could easily have its own thread)
As the Monomyth, or Words of Clan Mother, or any creation myth will tell you, Shor (Also called Lorkhaj, Lorkhan, Shezzar, Sep, Talos and Sheor), had his heart ripped out and shot into the Inner sea, where it formed the Island of Vvardenfell. However, being a god, even after his spirit departs to heaven and comes back (In a process known as "going through the Dream Sleeve") His soul will remain whole. Sometimes it/he forms a Mortal body (We only know for sure Pelinal Whitestrike, the CoC, King Wulfheart (all his reincarnations as well), and Zurin Arctus) These mortal bodies are known collectively as Shezzarines, because during the Reman era, Shor was called Shezzar, and -ine means "reincarnation of" or something similar (see Nevarine.) These bodies have a tendency to do amazing things.
Other suspected Shezzarines include, but are not limited to, Ebonarm, Cyrus the Redguard*, Frandar Hunding*, Divad Hunding*, Derik Hallin*, and a few others
*All HoonDings
Huh, you're right, all those asterisked guys are HoonDings. I wonder, is there a deeper relationship between Shezzar and HoonDing?
So, my character in Oblivion is a mortal vessel for a god/gods? Does that mean that he didn't "exist" before the events of Oblivion or is he just kind of possessed or something? Or are these characters (for lack of a better term) created by the gods in order to prevent whatever catastrophe the gods see coming from happening?
I am assuming by the CoC you mean the Champion of Cyrodiil or is that acronym applied to someone else as well?
No, that's not quite it, they are themselves as well as who they used to be. Sort of depends on which source you're looking at. If you ask someone who believes in the dreamsleeve/ that the Dreamsleeve is important in this context either way, then new "clumps" of soul gets attatched to the other part, forming a new being with simillarities to the originals (or at least I think that's how that works). I personally don't think the Dreamsleeve is here or there regarding Shezzarines ( or any other -ine), instead someone will have to explain Mantling to you, where you are you, but you do something like someone else until they are you, too. Or just play Shivering Isles.
Oh and yes, CoC is Champion of Cyrodiil.