Picked up an arcade last week with Fable 2. Though I have yet to finish it I feel like I can thouroughly compare it to Oblivion at this point. My opinions on which is better:

Graphics: Fable 2 has the edge here as the newer game. Better animation, lighting etc. Since Oblivion was one of the first games out this gen it's no shocker that the more recent Fable 2 looks better.

Music: Oblivion's music is waaaaay better then Fable 2's. I'm the type of person that finds music to be important to a game, especially RPG/adventure games. This gives a lot of points to oblivion in my book. It might not be so important to you.

Story: Oblivion takes the win again here. Fable 2 just isn't doing anything for me. While neither has an amazing story Oblivion takes the edge. 

Control: Fable 2 just has better fighting, running, swimming control etc.

Extras/sides/replay value: I think it's a tie here. Fable 2 has tons of extras like starting a family. But oblivion has so many extra quests to uncover it's staggering.

My Verdict: Tie.

What do you think?

Oblivion, easily.

Oblivion is better IMO.

Honestly, Fable was probably too simple for me. The franchise lacks depth in its story, character development and gameplay mechanics.

Oblivion also has better sidequests. The sidequests in Fable seem kind of pointless.

Oblivion simply because of hours of quests.

Oblivion definetly

Theres actual sense of danger, true conversations, actual different types of missions

Fable 2 is only better in the sims style parts

graphics, sound, world size, game size, replayability

all easy wins for oblivion

I prefered Oblivion myself as well, although Fable was a great game. I wish Fable had more dungeons/caves/side quests to make it last longer (i put in about 25+ hours on Fable versus 80+ on Oblivion).

I cant wait for Elder Scrolls V, didnt Bethesda say that was their next game? heres hoping for a christmas 2010 release

While playing Fable 2 tell yourself you are going to play good and stick with it.  The game will be better for it in the end because the game has one of the most fantastic endings *ever* and being good only makes that ending better.

Also, I think Fable 2 is the better game.  Bethesda games have a way of getting old quickly and give you little reason to finish the main story.  With Fallout 3 I at least got further than I did in Oblivion, but that isn't saying much.  I had absolutely no motivation to do the main story in Oblivion and instead just dicked around doing stuff.

That isn't a bad thing, but by the time I was finished with the game because it had become too easy or too hard (if you didn't level up perfectly you were screwed on the hardest difficulty setting) I knew next to nothing about the main quest because I never got past Kvatch.

oblivion was amazing, i would definitely go for that

I don't know about 2, but Fable 1 is definitely better than Oblivion.

Oblivion has huge world, more NPCs, more quests, longer playtime, more features, etc, but Fable has an amazing atmosphere like no other game, and that is more than enough.

I really enjoyed Fable 2's story because it never really took itself too seriously. It was dark and fun at the same time. I love grinding to level my character and that is where I fell Fable 2 is lacking. I maxed out everything(Strenght, Will, skill, Gestures, and dog tricks in under 40 hours), and grinding is my favorite part of WRPG's so it loses points on that for me. I also enjoyed the fact that you can do some pretty "evil" things in the game unlike Oblivion where you just break the law to become infamous for the most part. Fable 2 added a lot of humorous sidequests as well. I guess I love each game for different reason's, but if Fable had a more difficult leveling system it would win by a landslide for me. So the verdict for me is:

Leveling-Oblivion
Story-Fable 2
Graphics-Fable 2
Fighting system-Tie
Openness-Oblvion
Overall-I dunno