Actually, it is Oblivion ini question.
I am re-installing the whole game.
Guys, this is the moment to tip me with everything you think should take place in Oblivion and Streamline ini before I run it for the first time on a fresh Windows 7 and fresh Oblivion install.
I figured Streamline ini settings the way they were before my hard drive died.

Turned off music, Autosavings, turned on screenshots, sorted out what I wanted from Streamline ini, turned off borders.

Anything else?

Default ini says: bActivateAllQuestScripts=0

So, what you say: 0 or 1?

Also, how about
bAllow30Shaders=0
yes or no?

I don't see how this is a Streamline question, but I would caution against setting bActivateAllQuestScripts to 1. This setting does exactly what it says, it actiavates all in-game quests, as well as those added by mods, and the quests used for configuration purposes (E.g. Living Economy Config. Menu). Most likely the game will either lag considerably, crash, or you will be assaulted by in-game menus.

As for 'bAllow30Shaders', setting it to 1 will not hurt the game, but this setting does not force Oblivion to use 3.0 shaders.
Scroll down to the 'Graphics variables' section, in the link provided, for a explaination on how to force 3.0 shaders: http://www.tweakguides.com/Oblivion_8.html
Honesty, though, you may not even notice a difference with that setting, and forcing that shader causes graphical glitches for some.

bActivateAllQuestScripts - Leave it alone. The game already handles properly enabling and disabling those quest scripts it needs to do this for. Assuming this ini setting is actually used by the game, it's most likely a debugging switch that got left in.

bAllow30Shaders - Meaningless. Enabling that also means having to poke around and do some dodgy renaming of the default shader files. The results never seem to produce anything noticeable so it's best to just leave that one alone too.

Quite right Arthmoor, wasn't entirely certain on the effect of the effectiveness of the shader setting, and I noticed no difference when testing that setting personally.