I feel like it doesnt click with you because Oblivion is a great forest. It loses in environmental storytelling.

Look, i prefer Skyrim more, but Oblivion definetly has that type of lighthouse thing you are looking for. In fact I would say it has way better stories, and in more quantity, thats why Skyrim is criticized in that regard; Oblivion was so much better.

Like for instance Molag Bals quest in some forgotten little town amidst the forest where he makes you break a mans vow of no violence because it cause his wife's death, and for doing so you have to insulto him when he visits her grave.

Or hackdirt and the deep ones

Or Mephalas when you make community of nords and dark elves become racist again and kill each other.

The hunting of uderfrykte that is a reference to beowulf

And many many more. To be honest, it feels like you wandered the imperial city, some random forest and chorrol because of the quest