(unless I've really missed something) only two faces to choose from per race when generating a new character.
Actually the facegen feature is what a lot of 'roleplayers' consider to be Oblivion's best 'roleplaying' feature. Usually when people talk about 'spending almost an hour creating my character' they are actually just talking about tweaking their character's face, as opposed to actually selected their skills.
There are quite a few mods that alter the hair or body of npcs. You might remember Oblivion's rating being changed to M due to us sneaky modders "hacking" into Oblivion. Well those types of mods are actually the most popular. It's really sad but it kind of says a lot about the age and maturity of a lot of people who use Oblivion mods. The number of downloads that a hair or body gets absolutely dwarfs what a quest mod will get.
http://www.tesnexus.com/downloads/file.php?id=4431 - most downloaded mod on tesnexus. Over 300,000 downloads for a new race with custom hair. Currently 79 on tesnexus top 100.
This mod -
http://www.tesnexus.com/downloads/file.php?id=15568 - has been out for almost two months and already has almost 50,000 downloads. It debuted at number 5 on tesnexus top 100 (thankfully it is down to 29 now but that is still too high in my opinion). It was three days before the end of February and received the third highest amount of votes for files of the month for that mod.
http://www.tesnexus.com/downloads/file.php?id=15802 - currently number 8 on tesnexus top 100. Digital naked females sell well apparently. I prefer to watch real porn though. Over 50,000 for less than two months.
http://www.tesnexus.com/downloads/file.php?id=1965 - does jack shit as far as I can tell but apparently is good enough for over 180,000 downloads and the top 53 spot on tesnexus.
http://www.tesnexus.com/downloads/file.php?id=10168 - not naked chicks but close enough. 90,000 downloads, top 62 spot on tesnexus, and the modder who did it has the highest amount of kudos on the whole website - beating out the next closest person by almost double (kudos are an extra way of saying the modder is good when you don't think that a 10 is enough or you really want to express thanks).
In comparison the quest mod with the higest amount of downloads only 58,000.
http://www.tesnexus.com/downloads/file.php?id=6960 - it also coincidentally is all about wooing a lady who has new textures and meshes.
The next highest quest mod after that has 20,000 less downloads. While this is only on tesnexus I doubt that the other sites are any different. While the core group of modders and mod users on the Oblivion Mods forum on the Bethsoft forums are smart/intelligent individuals (at least if you don't try and get into an RPG discussion with most of them), there are also a whole lot of teens who obviously aren't getting any.
Oh by the way my complaints about those mods aren't about their quality- it is simply about the number of downloads that they get being undeserved in my opinion. The only mods that probably get more downloads are the big overhauls.