I'm feeling good-natured, so I'll just make it very clear where you fucked up regarding reading comprehension, without any further insults:
"Leading targets, or overaiming them to compensate for distance, just felt clumsy - it wasn't setup well."
That suggests, logically, that my problem isn't with the fact that you had to lead targets or overaim them, but that the whole system in which they were done "wasn't setup well." There's nothing in the context of the statement that a reasonable person wouldn't interpret that way.
The way in which one, in Oblivion, leads targets and overaims, feels clumsy. When aiming at a far distance (and if you're not aiming far, why use ranged in the first place?) it's a guessing game for the most part, that requires a few arrows be shot before you've really any clue where things are going to land, partly because the zoomed-in view, held weapon and cursor are all complicating the act of aiming. Moreover, it's especially frustrating to lead targets because of Oblivion's poor combat animations (notorious for their lagging in terms of frame-rate and responsiveness). It's not slick, it's not smooth, and no matter what kind of rangerbadass your character is supposed to be, making those shots at a far distance just doesn't work the way it ought to.
And, actually, come to think of it, in a proper RPG, the arrow would be more like a laser - I would tell my character where to attack, and the math would take care of everything else, same as if I were using a lasergun or a sword or a sock full of frozen oranges. Ideally, the bow and arrow would be like the laser. Oblivion would've been a better game if it had been.
Though even in Oblivion it still wasn't quite as bad as I remember archery being in the PC version of Fable.