I actually think people will be very happily surprised with the writing, and the characters, in Fallout 3, compared to Oblivion's NPCs. The dialogue options are meaningful and different, not just a list of items that NPC can speak about, organized in a list where the only real choice is the order in which you hear the items. There's only a few hundred NPCs (down from 1500 or so in Oblivion, and 2500 in Morrowind), so they're much more fleshed out and unique -- it also helps that there's 30-40 different voice actors instead of just a handful in Oblivion. At least from what we've been shown, that stuff feels much more like Fallout 1/2 than Oblivion.
You also won't be a jack of all trades, as in Oblivion - you have to make real choices that matter, and which dynamically change the fortunes of other characters. Aside from enhancing replayability, since you obviously won't be able to do competing objectives, those choices deepen the roleplaying. To elaborate more on the "Megaton bomb quest" -- when you arrive at that town, you can greet and be friendly with the sheriff. When you get the quest to potentially blow up the bomb, you can instead inform the sheriff that these dudes are trying to blow up the town. Or you can decide to blow up the town, but actually be unable to because you lack the mechanical skills to activate the bomb. Or you could just decide to blow the sheriff away when you meet him, in which case you'll likely be attacked by his buddies when walking through the town. Or you could, after blowing him away, decide to put on his sheriff's uniform, in which case some NPCs may attack you for killing the sheriff, but others may actually defer to you as the new sheriff. In short - meaningful options and real choices, and interesting characters to interact with - in that respect, I think Bethesda is appropriately emulating some of Fallout's best and most distinctive features.
I also wouldn't read anything negative into not being able to kill kids - it's still definitely an M-rated game - there's graphic violence, swearing, and "adult" topics like slavery, etc. -- some other stuff that Bethesda isn't revealing yet, involving mutation, and one tracked stat was "corpses eaten", which makes me suspect there'll be something similar to the Vampire-path in Oblivion/Morrowind, where you can get into doing some nasty stuff. It doesn't feel sanitized. I also like the changes to the level-scaling, the use of SPECIAL and level-based character development as opposed to the use-based skill system of the Elder Scrolls games.
Other general impressions -- while calling it "Oblivion with guns" is an oversimplication given some of the differences I've described above (and without also getting into the combat differences, etc.), I also think it's a superficially apt description because it definitely looks like Oblivion, not like Fallout, because of the perspective. Sure, they've doled out the carrot of being able to view the game from an isometric perspective, but I'm skeptical that it'll be in any way practical to do so. But the graphics look great - far better than I think they come across in still screenshots.
Areas of uncertainty - the VATS system looks really cool, and is visually spectacular, but I think we need to see more of the combat to judge how it feels in practice. I really like the VATS system, but I'm not sold on combat in general - there's also a few pieces we haven't seen at all, like melee combat (which is definitely an important part of the game). Also, everything in the demo occurred in relatively congested areas as well, with lots of rubble around blocking views, etc. - I'd like to get a better sense for how large the world feels, and looks, by seeing more expansive vistas, etc. (obviously one of the real strengths of Oblivion).
Other stuff I really like - the implementation of the PIP boy, and the ability to pick off radio broadcasts as you're wandering the wasteland. The use of robots like Mr. Handy from the Fallout 1 cinematic - the nuke effects -- and the overall atmosphere: the perspective gives you a better sense that you're exploring a place that's been blown apart and is messed up (suitably "postapocalyptic") as opposed to a flat, top-down view. It's actually kind of creepy -- it's one thing to see a giant castle in the background while playing Oblivion, and think that's a cool, realistic view -- it's another to be walking around and then to look up at Washington D.C. buildings that have been fucked up, since we have a vested attachment to that setting.
