So, I installed Nehrim, and I'm loving it. (highly recommend it, I'm surprised I didn't even know it existed until today)

For whatever reason though, after about 5 minutes the game becomes very laggy, like 5 fps. I have my power settings set to "performance" and I have Gamebooster running. The only other program running in the background would be my anti-virus software.

When I first start oblivion, it works fine, but it just starts slowing down.

Nope. Can't help you if you won't provide real information, sorry.

lol, alright what do you need?

I have "multithreading", Dual CPU using, and Memory Preload - 2GB checked in the Nehrim Optimizing settings.

I also have

Here's my DxDiag:

System Information
------------------
Time of this report: 2/1/2011, 22:17:29
Operating System: Windows Vista? Home Premium (6.0, Build 6001) Service Pack 1 (6001.vistasp1_gdr.100608-0458)
Language: English (Regional Setting: English)
System Manufacturer: Gateway
System Model: GM5474
BIOS: )Phoenix - Award WorkstationBIOS v6.00PG
Processor: AMD Athlon™ 64 X2 Dual Core Processor 6000+ (2 CPUs), ~3.0GHz
Memory: 2046MB RAM
Page File: 1191MB used, 3140MB available
Windows Dir: C:\Windows
DirectX Version: DirectX 10
DX Setup Parameters: /PackageInstall
DxDiag Version: 6.00.6001.18000 32bit Unicode

------------
DxDiag Notes
------------
Display Tab 1: No problems found.
Sound Tab 1: No problems found.
Input Tab: No problems found.

Display Devices
---------------
Card name: NVIDIA GeForce 8500 GT
Manufacturer: NVIDIA
Chip type: GeForce 8500 GT
DAC type: Integrated RAMDAC
Device Key: Enum\PCI\VEN_10DE&DEV_0421&SUBSYS_060A1043&REV_A1
Display Memory: 1010 MB
Dedicated Memory: 243 MB
Shared Memory: 767 MB
Current Mode: 1280 x 1024 (32 bit) (60Hz)
Monitor: Generic PnP Monitor
Driver Name: nvd3dum.dll,nvwgf2um.dll,nvwgf2um.dll
Driver Version: 8.17.0012.6099 (English)
DDI Version: 10
Driver Attributes: Final Retail
Driver Date/Size: 10/16/2010 13:55:00, 10023528 bytes



-------------
Sound Devices
-------------
Description: Speakers (High Definition Audio Device)
Default Sound Playback: Yes
Default Voice Playback: Yes
Hardware ID: HDAUDIO\FUNC_01&VEN_10EC&DEV_0888&SUBSYS_10192801&REV_1000
Manufacturer ID: 1
Product ID: 100
Type: WDM
Driver Name: HdAudio.sys
Driver Version: 6.00.5840.16387 (English)
Driver Attributes: Final Retail
WHQL Logo'd: Yes
Date and Size: 11/2/2006 02:36:49, 235520 bytes
Other Files:
Driver Provider: Microsoft
HW Accel Level: Basic

In that small section of the DxDiag report, I noted one bad thing. You are trying to use recent Geforce drivers with a very elderly graphics card. It's the only odd thing that I see. The 8n00 cards are now four years old, and the Geforce drivers any newer than two years ago are for recent Geforces, not their first experiment with the architecture. Try using older drivers and re-running the game. For other readers in the forum, besides myself, you can use "Spoiler" markers to reduce the apparent size of the full DxDiag report. I find the lack of formatting in there below the first audio processor data is too hard to read, like a soup of words that don't want to remain still long enough for me to catch hold of. But a couple of the regulars here are used to the full report.

Alright, I'll give that a try.

Do you think a new graphics card would help out? I know the one I have isn't good for gaming, but if I were to get a newer card, would it make a difference?

There are plenty of cards out now that would perform a hell of a lot better than that 8500GT. Just depends on how much you're willing to spend and the bottleneck of your CPU. Also, the power supply may become a factor depending on which card you get.