your right renerer is a document. Its oblivion and blend setting (which have the gears).
I tried to copy the Oblivion default (it says configuration setting) from the my computer/programfiles/bethesda/oblivion directory into the mydocuments/mygames/oblivion directory. The same thing happened when launching the game. It crashed.
Oblivion creates a directory tree called "My Games\Oblivion\" under your "My Documents" folder, wherever that is on your particular computer setup.
Go in that folder. Look for something called "Oblivion.ini". Delete the said file. Oblivion regenerates it when it starts up. Did you change your PC components lately (Graphics card, display resolution etc?). If so, before running Oblivion for the first time, insert the Oblivion CD, choose the settings option in the menu that shows up, and allow Oblivion to change settings based on your setup. Then try to start Oblivion... hopefully it does.
EDIT: If it doesn't, maybe you have a missing master (does the crash occur without the Oblivion game menu showing up?) - in that case, you didn't install one of the mods correctly... You can wither download Wrye Bash to track the missing master, or just start installing Oblivion from scratch considering your setup is still new. Doing it properly right now will save a lot of headaches later.
Also, for the OOO install, use the latest OOO as Arkngt mentioned above. You should also read http://tesivpositive.animolious.com/?page=preparing_for_mods to better understand mods as well.
EDIT again: the latest patches (official) can be found here on http://www.elderscrolls.com/downloads/updates_patches.htm.