You only get "Can't go this way, turn back" when you try to cross the worldspace border, whether by walking, or by teleporting (using a door linked to a point beyond the border, or with a script). So disabling the borders in Oblivion.ini WILL resolve this. It's possible that the crashes are because the game is getting confused when trying to send you back after a failed border-cross attempt, perhaps because it's unloaded too much of the worldspace you just came from and is unable to reload it again before it finishes sending you back.
It gives me these errors all over Tamriel though, not only around the border regions (for instance, I get it right outside Anvil and when trying to exit the IC). The only similar problem I've encountered is when two mods modify the border settings of Tamriel (as was Stirk's case). None of my doors are linked beyond Tamriel's border.
I'll check it with borders off anyways, but hopefully thats not the cause. Telling people to disable theirs leads to far too much "it doesn't work omg dislike"
I'll also move the worldspace with Gecko and have him test it again.
The only time I remember seeing this problem was when I tried out the MERP mod not too long ago. The problem came about (I believe) because I was using an old file paired with a new one (like an old esp with the new esm, not a double file or anything). I know it's not much help, but I really have no idea what it could be.
This could also be at fault, I'll check it out.
Hopefully one or all of these things will finally get it working. The sheer amount and variance of errors just has me completely confused.
Thanks for the help so far
[edit]
Attempt 1: moving hammerfell to the master index
Result: Hammerfell has no land.