Title's pretty much what's going on. I'm planning on doing a runthrough of Oblivion and narrating my escapades here, but there are a fuckload some details I still haven't decided on.
To explain each option:
Combat/Magic/Stealth are the three divisions of skills within Oblivion. More specifically:
Combat skills are Blade, Blunt, Hand-to-Hand, Athletics, Block, Armorer, and Heavy Armor.
Magic skills are Destruction, Restoration, Alteration, Illusion, Mysticism, Conjuration, and Alchemy
Stealth skills are Sneak, Security, Marksman, Light Armor, Acrobatics, Speechcraft, and Mercantile
I should mention that I will not use Blunt (as blunt weapons are inferior to blades in almost every way, being heavier, slower, and with generally inferior reach, not to mention the availability of powerful blades vs. powerful blunt weapons.) I would vastly prefer Heavy Armor to Light after doing a playthrough with the latter. When I say an archetype, I mean the skills I'll actually use, not necessarily my chosen "major skills" which determine leveling.
Good, evil, or neither is fairly self-explanatory. Good characters don't do stuff like murdering people for their hats. An evil character won't end up accepting as many miscellaneous quests because evil people aren't very helpful. A character played as neutral will do every questline and will kill an NPC if they have a particularly important/rare piece of gear and said NPC is not needed for a quest. (Evil characters also won't do the Knights of the Nine questline because it requires you to be a good little boy/girl/cat/lizard.)
Special rules are possible options to make the game even harder.
Permadeath is obvious. If you die, you lose.
Permanent breaks mean that if you allow a piece of equipment to fall to zero durability, you may not repair it. Enchanted armor may still be worn but will likely be worthless.
Archetype restriction means only using skills within your archetype (plus Acrobatics and Athletics because they're impossible to not train.) So, mages can't grab claymores and fighters won't be throwing fireballs.
Not leveling optimally means leveling up whenever you can and not necessarily distributing stat points in an efficient manner. (Please don't choose this because minmaxing is the only way to survive this, other than Conjuration spam as Conjuration isn't affected by the modified damage table, so summons deal and take 1x instead of 1/6 and 6x damage.)
There are a few working item duplication exploits in Oblivion. The main reason I have no issue with using them personally is that gold is only relevant for the purposes of maintaining your gear early game (and good gear almost never spawns in shops), and certain items are very hard to find more of (e.g. Black Soul Gems, Varla Stones.) You also can't duplicate weapons and armor, generally. The real purpose I'd duplicate for is to have a nice house, particularly Frostcrag Spire so I could use custom spells without having to go ALL AROUND THE GODDAMNED COUNTRY to get admission to the Mage's Guild.
With that, I just have one last question. Interested?