I was a member of Beth's forums right when Morrowind came out but I stopped posting there years ago - too many kids post there (yeah, I'm a grumpy old gamer! hehe).
I'm not saying apply Radiant AI exactly as it was in Oblivion - I agree having important quest characters travelling all over the place is bad. Just have it apply to non-quest NPCs and write your quests/scripts intelligently.
And Cassius was not hard to find at all.
IMO they listened to gamers TOO MUCH and made the game much too simple. It's more like a "My First RPG" type of game where EVERYTHING is spelled out for you and it doesn't matter if you never played an RPG before.
Skill system was over simplified, you could join EVERY faction with no repercussions or penalties (I hear you could become head of the mages guild without even casting a spell!), the messed up level scaling (I mean Arena Champion at level 2?) and loot scaling (made searching dungeons pointless).
Don't get me wrong, I knock Oblivion a lot (and Fallout 3) BUT I think as an adventure/RPG-Lite console game, Oblivion is pretty good. Easy to get into, fun in short spurts, combat heavy/dialogue-light. It really does feel like Grand Theft Auto - big open world with a lot of low-depth yet fun distractions.
But as a PC RPG, especially one with a more hardcore lineage, it just fails miserably.