Anyways, in OBLIVION I was disappointed by how generic the beast races feel. And here I'm talking about NPC's, not my own character. In oblivion they are way too intermingled with the humans. They live in the same city, village, district... I don't see cultural representation of the race.
In real life, there are china towns, little italy, little saigon... etc. When you go there, you probably can't understand their native talking, you see buildings way different than other places, and most importantly, you see mostly chinese/italian/vietnamese people hanging out there.
I think to make the races more unique, you need to have kahjit towns, argonian towns, where you see mostly kahjit/argonians, you can't understand their native talking and the signs are unreadable... that's when you see a race standing out with its own unique culture.
I hope this thread expresses my opinion better