I've recently changed from my old windows xp PC to a new one with windows 7.
Now, I've been trying to reinstall Oblivion and add QTP but I noticed all the original data files get compressed to BSA files from the original Oblivion installation and I figured that would be the reason why a texture replacer such as QTP wouldn't install. I've been trying it in a variety of ways but I can't for the life of me figure out how to make it work, the normal installation directions certainly don't work (also using OMOD) and I've noticed stuff about Vista issues with mods but I haven't found any solution anywhere as of yet

Therefore my question, how on earth do you get QTP (or any mod) to work on my fresh windows 7 installation?

To start with, and to make your life easier, don't install Oblivion to the Program Files directory.

Make a new Games directory and install it there.

Then, an omod install or a manual install should be fine. The files will end up loose in directories in the Oblivion/Data folder, but that's fine because the loose files will override the ones in the BSA files.

Make sure you have BSA Redirection turned on in OBMM, or use Wrye Bash with a similar feature.

Make sure BSA redirection is turned on in OBMM > Utilities > Archive Invalidation. The original data files are always packed in BSAs. Did you install Oblivion to the Program Files (x86) folder? Try browsing this: http://sites.google.com/site/oblivionpoinfo/install.