I think the big problem here wasn't so much the marksmen damage (I still think it needs a buff though, or at the very least locational damage) as it was level scaling. When you're a high level with 100 mm and 100 sneak you should be owning the show with your bow and arrows, not shooting bandits in glass 100 times to barely dent them!

This sounds like the actual problem. Things weren't perfect in Oblivion, but the PClvl - x formula made petty thugs almost as tough as a legendary hero. Marksman needs to be changed, but maybe not as much as it seems.