Oblivion's only claim to supremacy over what came before it is in the graphics,
I also felt he combat system was better. Morrowind's and Daggerfall's combat systems just svcked.
I also thought that the new editor was better then the Morrowind editor, but I suppose that isn't technically an aspect of Oblivion.
@946000
I don't think telling the truth here will really "blow the op's mind". Its really not that hard to understand, especially if you played SI. All one has to do is recall the scene in which Dyus explains Jyg's library, and how he predicted everything to a mark.
If one excepts that Jyg's sphere was mainly predictability, and that the creation of mortals created free will for the first time, then it is easy to understand that Nirn's creation caused Sheo to mythically replace Jyg.
The only reason why Jyg resurfaces every era is beacuse SI becomes too ordered (as if it exists too long things start to settle). Thus, madness is weakened and order gains a foothold for a while until to ordered SI becomes disorganized again.