I'm not surprised because if they tried to release a 4th game with that engine people would go nuts.
Don't get me wrong, yesterday I started a new Oblivion and I'm back in the thick of it. However the combat is way too dated for 2008 (Fallout), much less 2011.
But outside of combat and the overall physics of the game, how much did the engine effect Oblivion? I don't see anything bad coming from this, but I guess my basic question is...
How would a new and improved engine affect the game specifically?