Well a lot of the reason that the game runs so good is that the resolution is only 600x800.
A 17" minitor should be running 1024x768 and a 19" runs 1280x1024.
So a big part of upgrading your video card is that it is more common for people to be using larger monitors, thus it takes a more powerful card to run the same game at the same settings with the higher resolution.
But speaking of oblivion, there have been a few major video card upgrades since the game was released. I believe the game was reccomended to have have an x800 ati, or a 6800 nvidia.
Both manufactures have already released 3+ cards since then.
so jumping from a 6000 (gforce 6 series) to a 8600 (geforce 8 series) skipping the geforce 7 series (7600, 7900 etc). Well that is a huge leap.
Another aspect is that you are now using pixel shader 3.0 (dx9) and your card is capable of pixel shader 4.0 (dx10)if you are running vista. Thus making the game rendering easier on the card. the 6600 was a pixel shader 2.0. Without even mentioning the ddr3 ram or the newer chip sets.
Also most game manufactures try to make games that will run great on the machines up to 2yo. Crysis on the other hand... you cant run the game on max setting even with 2gigs+ of ram, dual or quad core cpu's and a single 8800gtx. Far cry was the same back in its day.
So now days the best bang for the buck nvidia card is the 8800gt. It has 512mb ram and is faster than the 8800gts 320. Nvidia is messing with out heads, the 8600gts is better than the 8600 gt. who knows why they named this new card like they have. Ans the price tag is at $250 usd atm. where as the 8800gts 320 is about $275 usd.
http://www.zipzoomfly.com/jsp/ProductDetail.jsp?ProductCode=10007125
Edit. a few days a go the 8800gt 512mb was $250, now its $280
