So I just joined a few months ago but never posted much.

I was a long time player of oblivion.

So what was the reasoning or why did they abandon the ps3 version of Oblivion?

I don't think that's quite the way it went. As I recall, the PS3 was still in development when Oblivion was being done, and the game was ported to PS3 by a third party, while the Xbox and PC versions were done directly by Bethesda. That probably accounts for the fact that the DLC was never ported over.

This. The PS3 was released a few months (November 2006) after the game was released (March of 2006) and Oblivion itself didn't hit the PS3 until a full year after the PC and 360 versions.

For starters, its unlikely Bethesda even had the specs of the PS3 to work with during the games development cycle, heck, they didn't even have the 360 specs until around six months before release, hence why a few features from the trailers (Done before that six month mark) -mostly releated to graphics- got cut.

The PS3 version was done by a third party -4J Studios- and was a direct port of the 360 version I believe. By that point, the Beth dev teams had wound up their work on Oblivion and had moved over to Fallout 3, so many PS3 exclusives bugs were never sorted (Vampire cure) and 4J only ported two of the DLC -Knights of the Nine and Shivering Isles.

It wasn't really abandoned by Bethesda, since technically they never had any real involvement in the PS3 version beyond the very basics.