Yeah, I hate when people's idea of a good game is based solely on graphics (unfortunately a lot of game developers do this too). Graphics could be mediocre with addictive gameplay (see games like Katamari, Guitar Hero, Wii).
You can make Fallout last a while if you don't touch the main quest often. The world is big, and there's plenty of side missions.
I don't think the two games are all that comparable. Sure they are both made by the same company and run on the same engine, but I think Oblivion is more focused on freedom and medieval lore and Fallout is more of a straight forward story based game. After playing both I find myself liking them both on different merits. I love being able to slash random things in Oblivion and completing the numerous side quests like the fighters guild and mage guilds. As for Fallout I find myself not liking the side quests as much since they don't help progress my character much more than earning experience and picking up some loot. Of course, those epic battles in the main quests are worth the price of the game alone.