Suiboon: Oblivion
"Plastic" world, npcs are wooden, level system the most idiotic ever seen, monsters scale with your level, dungeons are all look-a-likes. But aside from these things I did play this a lot and there are some good quests in it. The assassin guild quests are pretty good.
Can't really remember anything as big of a failure as Oblivion (with so much missed potential).
Mods remove most of the problems except the NPCs because of the speech.
The auto-scaling was a really bad idea. Fallout 3 handled it a lot better but still - I want, sometimes, to feel like I'm way outclassed. Being level 4 and running into a monster that would take a level 10 character to safely kill it is a thrill - because you probably CAN kill it at level 4 but it just won't be easy to do so. Instead, you only got easy monsters to kill in Oblivion.
The skill system is really bad as well, I agree - at least from what I can remember
Say you start the game with certain stats. You discover your stats are too low to pick good locks so you don't do it but leave locks for later. When you level the game will go "hey you don't pick locks so you won't need this skill!" so you don't get any multipliers while skills you constantly use because they're already good enough get all the multipliers.
Good thing mods fix most of this crap.