I know there are some other topics related to the issue but I feel mine is different. (Maybe cause I'm quite new here).
I recently purchased Oblivion Game of the year edition via steam.

I just started the game, completed few quests in Imperial City and went on to deliver amulet to Jauffre. When I'm getting near Wynon Priory the game freezes. The same is when loading area through fast travel. I tried disabling mods, loading from different saves, startting the game from the beginning. None of it helped.

After search on forums I tried:
- tweaking "SpecularPass" in .ini.
- Installing newest drivers and Directx,
- tweaking sound acceleartion,
- renaming mpeg2dmx (though it appears I don't have it),
It didn't work either.

My spec
Win XP SP 3
pentium 4 3.2
2,5 GB RAM
GeFroce 440 GT 1 GB

Generally my computer is quite old - the only new thing is graphic card.

I'd appreciate any help