http://www.tesnexus.com/downloads/file.php?id=2097. Many folks also find http://www.tesnexus.com/downloads/file.php?id=22368 useful.
Naturally, I consider all my own mods essential.
Check the first link in my signature. For the most part, they address problematic areas of gameplay rather than adding any actual new content. For most of them, there are alternatives by other modders... if you're not sure about mine, look around and see what sounds like it'll fit your playstyle; but having
something addressing each of those categories generally makes for a better game.
One that I haven't personally tackled, and probably won't because it's been done very well already, is the horribly broken economy... check out http://www.gamesas.com/index.php?/topic/1093612-relz-enhanced-economy/. It does a lot of other stuff, including adding extra quests in the latest version, but that's all optional and disabled by default... the core fixes it provides are essential IMO, even if you don't care for the rest.
Another that I personally find essential is http://www.tesnexus.com/downloads/file.php?id=22819, which is best when combined with the Real Lights component of http://www.gamesas.com/index.php?/topic/1094185-relzbeta-weather-all-natural/. (Nothing wrong with the rest of All Natural, either.)
Finally, and this should probably have been first, the one mod that you'll find
everyone agreeing on is the http://www.gamesas.com/index.php?/topic/1091480-relz-unofficial-oblivion-patch-320-and-326-hotfixes-relz/.