You need to go into a bed/camp area and sleep.  This way you level up and tweak your stats.  If you are starting out, for crying out loud, DO NOT, go into an Oblivion gate, particuarly when you don't know how to level up. 

As for the game, Skyrim may be better, and pretty much is considered it, but I find Oblivion to be really good, and a decent consideration for someone who wants to pick up a decent long game, on the cheap.  I still need to finish it, and then get to Fallout 3 and then I will take on Skyrim.  Heck, I also have New Vegas to. 

I prefer Oblivion over Skyrim. OP if you have the game of the year edition do not contract vampirism or you'll be screwed.

Yes. Just buy the GOTY edition or the anniversary so you get all the dlc with it. One of the greatest games of all time.

Edit: Since you want to get this on PS3 either never get infected with vampirism or buy a standard edition of Oblivion to go along with the GOTY (or anniversary) if you ever want to cure it. Long story short, you apparently need the normal edition on PS3 to do a work around to cure it. I did research on it before when I became infected ( you will be but it's not until you reach full vampire that you become one apparently). 

I was just refering to you calling the gameplay broken. It's totally awesome as long as the static enemy level mod is implemented. I see no other design flaw.

How come is there no cure for becoming a vampire. surely they would have a cure. What does it do to you. 

Im just starting out aswell

Just play Morrowind. Morrowind beats the Daedra out of the other 2. (See what I did there?)

Cool! Keep us updated about your adventure.

I liked oblivion over skyrim and the download content shivering isles is amazing.

I started playing Oblivion a few months before Skyrim came out. Once I started playing Skyrim, I never went back to Oblivion. Let's just put it that way.