You still have attributes you know, instead of selecting something on a screen, you find a stone and decide if it works for you....which is great because if I feel like wearing heavy armor I take the steed stone, if I wear light armor I take the lover stone.
Fixed attributes are stupid and unnessecary, imo.
They took out more than just damage modifiers though. The attribute system in Oblivion did an unbelievable amount of stuff. You had skill modifiers, damage resistance, running speed, magical resistance, regeneration bonuses, random chance... you had a LOT of content concentrated into those choices that helped you to customize your character.
That said, the 1-100 scale for attribute points was plain silly.
IF, the perk system or something else had 100% replaced the level of player customization that could be had from Attribute changes, I would not complain, but the more and more I play the less and less I feel like my PC is as truly unique as the game is telling me. They limited the choices you could make in a way that was really a shot in the knee. Now, they do have Health, Magicka, and Stamina changes... but if we're going that far, why don't we just do like they did in Fallout 3? You have an attribute scale that was more 1-20, where you got many fewer opportunities to boost attributes. This meant that adding a point had much more Weight and much further reaching consequences. Yes, you kind of railroaded yourself as to what you were playing early... if you used all your points to get 20 str, limiting the rest of your skills to 5... you were going to perform as a good melee fighter and about nothing else.
You could probably do a halfway compromise if you used more skills, but they didn't do that, so we were left with a system that only let you make half a character prior to modding.
Edit: Mind you thats my opinion, but thats is more of an explanation than I provided previously.